Vodafone closes in on appointment of new chief executive

Vodafone is closing in on the appointment of a new boss after its interim chief executive won support from key institutional investors for her stewardship of the telecoms giant.

Sky News has learnt that the FTSE-100 group’s board is leaning towards naming Margherita Della Valle, who was its finance chief between 2018 and the end of last year, as its permanent CEO.

Telecoms industry sources said on Thursday that an announcement could be made by Vodafone about Nick Read’s successor in the coming days.

Ms Della Valle has worked for Vodafone in its various incarnations, based both in Italy and the UK, since 1994.

She took over as interim CEO on 1 January, having been elevated to the role when Mr Read stepped down the previous day.

City insiders said Ms Della Valle had accelerated a number of important strategic initiatives during her four months at the helm, and had impressed leading shareholders with her approach to the job.

One source cautioned on Thursday that Vodafone’s board, chaired by the former Heineken chief Jean-Francois van Boxmeer, had yet to take a formal decision about the appointment of its next chief executive.

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Several high-quality external candidates are also said to have been in talks with Vodafone in recent months, and it remained possible that an announcement could still be several weeks away.

Growing pressure on the company

Institutional investors have been anticipating an announcement about CEO succession before the company announces its full-year results on 16 May.

The appointment of a new CEO will come amid growing pressure on the company, which was criticised under Mr Read for being too slow to take strategic decisions amid a rapidly shifting telecoms industry landscape.

Vodafone’s largest shareholders include the UAE-based telecoms group e&, which this week disclosed that it had increased its stake to 14.6%.

E& has not shown any interest in making an offer for Vodafone, although analysts have speculated that such a move is not implausible in the medium term.

Vodafone shares have slid in the last year

Shares in Vodafone have slid by a quarter during the last year, and the company now has a market value of only £25.5bn – a far cry from its peak valuation of well over £100bn.

Liberty Global, the US-based telecoms company, has also acquired a stake in the British mobile phone network operator – a move described in February by the buyer’s chief executive, Mike Fries, as “an opportunistic and financial investment”.

Vodafone has also drawn investment from a vehicle headed by Xavier Niel, the French telecoms tycoon, another sign that industry executives from around the world believe that the company is either underperforming or undervalued.

Desire for shake-up

Vodafone’s board would be unlikely to name Ms Della Valle as its new CEO without assurances of support from leading investors.

As a long-standing company insider, she was initially regarded as an outside contender to replace Mr Read because of some shareholders’ desire to see a shake-up under an externally appointed boss.

Vodafone remains in discussions with the owner of Three UK about a merger of their British operations, while it was also reported this week to be in talks about various deals involving parts of its European operations.

Its business in Germany has stuttered, while the company has also failed to capitalise on M&A opportunities in other markets.

Vodafone declined to comment.

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