US private equity groups Cerberus Capital Management and Providence Equity Partners are planning a USD15 billion rival bid for Vodafone Group’s struggling Japanese unit Vodafone KK, potentially derailing ongoing buyout talks with Softbank Corp. According to sources familiar with the deal, the all-cash offer is expected to be submitted to Vodafone’s board imminently and the two groups are in negotiation with several banks to fund the deal; Cerberus is said to be trying to borrow between USD8.5 billion to USD13.5 billion for the purchase.
Earlier this month it was announced that Softbank Corp had reached a basic agreement to buy UK-based Vodafone Group’s approximately 98% stake in Vodafone KK, in a deal which, if completed, would be the largest ever acquisition by a Japanese company. Vodafone confirmed it had agreed in principle to sell off the unit, and thus exit the market, and Softbank said it aimed to reach a final agreement with the UK operator by end-March. Industry sources say the Cerberus, Providence bid is unlikely to match Softbank’s offer, but it could raise the stakes for Softbank if they do decide to bid higher.