Vodafone Starts Negotiating Exit from Hungary for HUF 715 Billion

  • 22 Aug 2022 1:15 PM
  • Hungary Matters
Vodafone Starts Negotiating Exit from  Hungary for HUF 715 Billion
Vodafone Group has entered into heads of terms with 4iG Public Limited Company and Corvinus Zrt in relation to the potential sale of 100% of Vodafone Magyarország Távközlési Zrt (Vodafone Hungary) for a total cash consideration equivalent to an enterprise value of HUF 715bn (€1.8bn).

Vodafone Hungary is one of the leading converged network operators in Hungary and a combination with 4iG will create a clear #2 operator across mobile and fixed communications with broader ICT (Information and Communications Technology) capabilities. It also supports the Hungarian state’s goal of creating a national ICT champion.

The combination with 4iG is complementary, with limited overlaps and the addition of Vodafone Hungary’s infrastructure to the 4iG group will create a stronger competitor to the incumbent operator.

Nick Read, Chief Executive of Vodafone, said: “The Hungarian Government has a clear strategy to build a Hungarian owned national champion in the ICT sector. 

This combination with 4iG will allow Vodafone Hungary, which has a proud history of success and innovation in the country, to play a major role in the future growth and development of the sector as a much stronger scaled and fully converged operator. 

The combined entity will increase competition and have greater access to investment to further the digitalisation of Hungary.”

The transaction is subject to completion of confirmatory due diligence, the Parties entering into binding transaction documentation and obtaining regulatory approval. 

The Parties are targeting completion by the end of 2022.

Vodafone’s shared services business in Hungary – VOIS – is not included in the transaction perimeter and it will continue to provide services to Vodafone’s other operating companies.

Press Release

4IG, State Make Offer for Vodafone Hungary

The transaction would give 4iG 51% of Vodafone Hungary and the state a 49% stake.

“The combination of 4iG and Vodafone is a significant step towards building a Hungarian-owned national champion in the ICT sector,” 4iG said. 

The deal “creates significant potential for further growth through cross-selling opportunities, full fixed-to-mobile convergence and scale, resulting in major B2B and B2C revenue synergies”, while the potential of infrastructure consolidation “creates sizeable long-term shareholder value from in-market cost and capex saving synergies,” it added. 

In a statement, Economic Development Minister Márton Nagy noted the government’s commitment to significantly increase Hungarian ownership in strategic sectors, saying the transaction would facilitate building a Hungarian-owned market leader to meet challenges of the 21st century and contribute to boosting Hungary’s competitiveness, while serving nearly 4 million customers.

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