Key Highlights
- Vodafone has taken a step forward to slim down and focus on its core markets. It flogs the Hungary Unit to Systems Integrator 4iG.
- The deal stands out as a significant change in the 4iG trajectory.
UK-based Vodafone’s bid to slim down and concentrate on its core markets has taken a €1.8 billion step forward.
On Monday, The telco agreed to sell 100 percent of its Hungarian unit to a pair of buyers: local systems integrator 4iG and state-owned holding company Corvinus. By the end of this year, the transaction is expected to close, subject to due diligence and the usual regulatory checks.
The deal marks a significant change in trajectory for 4iG, which until now has generally concentrated on the IT networking and services sectors, especially consultancy, security, and data centers. 4iG has entered a whole new, albeit related market, becoming part of this trend of closer alignment between telecoms, IT and cloud with the addition of Vodafone Hungary’s mobile and fixed-line operations to its portfolio.
In a statement, 4iG said the deal creates significant potential for cross-selling opportunities, full fixed-to-mobile convergence, and scale, resulting in primary B2B and B2C revenue synergies. It also positions 4iG and Corvinus to play critical roles in the digital transformation of the Hungarian economy.
4iG chairman and CEO Gellért Jászai declared that the acquisition of Vodafone Hungary would be the most significant domestic telco transaction in the last thirty years, to a similar extent to the privatization of [former state-owned monopoly] Matáv after the regime change.
The acquisition will create a predominantly Hungarian-owned group of info-communications companies and an exact number two operator in the Hungarian market.
Vodafone CEO Nick Read said that 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 significant role in the future growth of the sector as a much stronger, scaled and fully converged operator. The combined entity will increase competition and have greater investment access to further Hungary’s digitalization.
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