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. Last Updated: 07/27/2016

Mannesmann Launches Drive Against Vodafone




FRANKFURT, Germany -- Germany's Mannesmann AG on Monday launched a campaign to persuade investors the company's rejection of a record hostile takeover bid by Vodafone AirTouch PLC is the best way to ensure shareholder value.


Mannesmann said it expected its average annual proportionate telecoms earnings before interest, taxes, depreciation and amortisation, or EBITDA to grow at more than 30 percent a year from 2000 to 2003.


The forecast came after the German telecoms and engineering group reiterated its rejection of Vodafone's revised bid, calling it undervalued. Mannesmann, however, said it would like to continue cooperating with its British suitor in the future.


The D?sseldorf-based group said in a statement Monday it expected average annual proportionate mobile telecoms EBITDA growth of more than 25 percent to 2003.


It expected proportionate mobile telecoms EBITDA of around 3.8 billion euros ($4.06 billion) in 2000 and that EBITDA at its fixed-line business would break even in 2000. Tele-commerce would help buoy business overall.


"Tele-commerce will be a significant driver for Mannesmann going forward based on the inevitable convergence of telecommunication and e-commerce," Mannesmann said, adding that nine-month 1999 proportionate mobile telecoms EBITDA grew about 75 percent, or 50 percent adjusted for acquisitions.


"Mannesmann is well-positioned to capture this value based on its over 2.5 million Internet clients," the company added, saying it expected tele-commerce revenues to exceed 500 million euros in 2001.


Mannesmann chief executive Klaus Esser, who was in London on Monday to woo analysts, investors and the media, said Sunday the price offered by Vodafone - at over 253 euros per share after Friday's bourse close - was "totally insufficient."


Esser is planning a grueling 20-city road show over two weeks as Vodafone counterpart Chris Gent heads for the United States in his latest bid to convince investors of the benefits of the largest hostile takeover attempt ever.


Mannesmann's CEO, however, apparently nuanced his tough stance Sunday, saying his group wanted to maintain fruitful links with Vodafone in lucrative joint ventures in Germany, Italy and France.


"As far as Vodafone AirTouch is concerned, it is our intention that we both find a way back to the good cooperation in our three joint ventures," Esser said at a news briefing at Mannesmann's headquarters.


Esser said earlier this month that Vodafone's revised bid, currently valued at around 127 billion euros, jeopardized "the value and principles of our joint ventures and our contractual agreements."


Vodafone on Sunday welcomed Mannesmann's proposal to maintain the joint ventures - mobile operators Mannesmann Mobilfunk in Germany, Omnitel in Italy and SFR in France, along with fixed-line operator Arcor in Germany.