Vodafone launches bond purchase tender

10 Jan 2003

Vodafone has announced details of a cash tender offer to purchase bonds thought to be worth up to EUR6 billion. The bond buy back issue, issued by its Vodafone Finance subsidiary, is being interpreted by the market as a sign that the operator is shying away from implementing a share buyback. According to the Financial Times, Vodafone has a current facility to buy back three billion shares, roughly 5% of its total shares in issue. However, should all bondholders opt to sell their holdings this could reduce the company’s cash holdings to under EUR1 billion, making it impossible for the operator to initiate a share buyback without going to the markets to raise more funds.