London - Vodafone AirTouch, the world`s largest wireless-communications company, had agreed to buy Mannesmann in a $198,9 billion stock swap, industry sources said yesterday. If the deal goes ahead it will be the biggest takeover ever.
Vodafone will pay 59 of its shares for each Mannesmann share, giving the German company 49,5 percent of the combined group, the sources said. That values Mannesmann at e372,88 (about R2 222) a share, 15 percent more than yesterday, based on closing prices.
The agreement, subject to approval by Mannesmann`s supervisory board, will end a three-month battle giving Vodafone control of Germany`s largest cellular-service company to make it the biggest telecommunications company in Europe.
Vodafone and Mannesmann officials declined to comment.
Andrew Moffat, an analyst at ABN Amro, said Vodafone shares would be worth P5,50 each if the deal succeeded. Yesterday Vodafone`s stock fell 31,5p, or 8,2 percent, to P3,54. Mannesmann fell e9,38, or 2,9 percent, to e315,62.
Chris Gent, Vodafone`s chief executive, aims to boost the company`s share of a cellular market expected to grow to 1 billion phones worldwide by the end of 2003, from 427 million last year.
Together the companies will have 42 million customers. Mannesmann owns Mannesmann Mobilfunk in Germany and Orange in the UK.
The transaction would be the biggest takeover in history, surpassing America Online`s pending $154,8 billion acquisition of Time Warner.
Mannesmann`s position has weakened since Vodafone struck an agreement last weekend with France`s Vivendi, which had been seen as a possible Mannesmann ally, to form a European Internet business and potentially a traditional phone network.
Mannesmann`s acquisition of Orange, the UK`s third-largest cell company, from Hong Kong`s Hutchison Whampoa last year made it Europe`s top wireless company, and sparked Vodafone`s takeover bid in November.