Swisscom to acquire Vodafone Italia
March 15, 2024
Swisscom has entered into binding agreements with Vodafone Group for the acquisition of 100 per cent of Vodafone Italia for €8 billion on a debt and cash free basis with the aim of merging it with Fastweb, Swisscom’s subsidiary in Italy. The transaction consideration will be 100 per cent cash and will be fully debt-financed.
Swisscom said that Vodafone Italia and Fastweb will bring together mobile and fixed infrastructures, competencies, and capabilities to create a leading converged challenger in a market with material growth opportunities. Mobile customers will benefit from improved connectivity and service quality, thanks to a fully controlled and end-to-end managed wireless network. Broadband customers will also benefit from increased service quality, thanks to the combination of Fastweb’s end-to-end managed wireline network and Vodafone’s 5G based Fixed Wireless Access (FWA)
Through this transaction Swisscom significantly reinforces its presence in Italy, where it has been operating since 2007 through Fastweb. Fastweb has grown by over 50 per cent in terms of customers, revenue and adjusted EBITDA over the past ten years.
Closing is subject to regulatory and other customary approvals, will not require a Swisscom shareholder vote, and is expected to occur in Q1 2025.
The combined entity and Vodafone Group will enter into several transitional and long-term service agreements, including a brand licence agreement, which permits the use of the Vodafone brand in Italy for up to five years post-closing. Vodafone will provide certain services for an initial total annual service charge of €~350 million, expected to decrease over time.
Swisscom and Vodafone Group are also exploring a closer commercial relationship to enable collaboration across a broad range of areas, beyond Italy. The key areas of commercial collaboration that Vodafone and Swisscom are exploring include IoT, enterprise services and solutions, procurement, operational shared services and roaming.
Christoph Aeschlimann, CEO at Swisscom, said: “Swisscom has been operating successfully in Italy since the acquisition of Fastweb in 2007. Over this period, we have built a strong track record of investment and profitable growth in Italy. The industrial logic of this merger is very strong. Fastweb and Vodafone Italia are an ideal fit to create high added value for all stakeholders. As a result, private and business customers will benefit from the most comprehensive offer. Swisscom will also be strengthened as a whole, allowing us to continue making significant investments in the Swiss and Italian market.”
Michael Rechsteiner, Chairman of the Swisscom Board of Directors, commented: “The Swisscom Board of Directors has thoroughly and comprehensively assessed the opportunities and risks of this transaction and has come to the firm conclusion that the opportunities for all stakeholders by far outweigh the risks inherent in a transaction of this size. The acquisition of Vodafone Italia is also compliant with the Federal Council’s strategic objectives for Swisscom. With full conviction that the decision is in the interests of Swisscom as well as Switzerland as a whole, the board has therefore unanimously approved the transaction.”
Margherita Della Valle, CEO Vodafone Group, added: “By bringing together Vodafone Italia and Fastweb, we are enabling the creation of a strong converged telco, well positioned to compete in the Italian market. And we are opening the opportunity to establish a broader commercial partnership between Swisscom and Vodafone.”