Vodafone aims to take control of Japan Telecom

Vodafone Group PLC announced Thursday that it has made an offer to take full control of Japan Telecom Co. Ltd. by purchasing an additional 21.7 per cent stake in the company.

Vodafone, the world’s largest mobile phone operator, already owns a 45 per cent stake in Japan Telecom, Japan’s third-largest mobile phone operator.

Rumors of the deal surfaced Monday.

“It’s not a done deal – not yet. At this point it’s a tender offer valued at about 1.8 billion pounds (US$2.64 billion),” said Jon Earl, Vodafone investor relations manager.

The tender offer will open on Friday and will end on Oct. 11, Vodafone said.

Specifically, Vodafone will buy a minimum of 10 per cent of East Japan Railway Co. Ltd.’s 15.1 per cent stake in Japan Telecom and will offer 450,000 Japanese yen (US$3,827.83) per share for the remaining Japan Telecom shares on the market, Vodafone said in an online presentation.

Though Japan Telecom is a full-service carrier with a broad range of operations, including long distance, data and Internet, Vodafone’s main interest in the company lies in Japan Telecom’s cellular unit, J-Phone Co. Ltd., Vodafone said.

As of Aug. 1, J-Phone had 10.9 million customers, making it the fastest-growing wireless operator in Japan, Vodafone said.

Upon completion of the offer, which is expected to be on Oct. 26, Vodafone anticipates it will own up to 66.7 per cent of Japan Telecom while holding an “economic interest” of up to 69.7 per cent in J-Phone, the company said.

Along with strengthening Vodafone’s presence in “the attractive Japanese wireless market,” the company sees the acquisition of J-Phone as a way to give it “greater exposure to the development of 3G (third generation) and wireless data in Japan,” Vodafone said.

Vodafone, in Newbury, England, is at http://www.vodafone.com/. Japan Telecom, in Tokyo, can be contacted at http://www.japan-telecom.co.jp/. Japan Railway Co., in Tokyo, can be contacted at http://www.jreast.co.jp/e/.