(Associated Press via NewsEdge) Swisscom will buy back a 25% stake in its mobile unit from Vodafone Group for 4.25 billion Swiss francs ($2.05 billion), Swisscom said.
The transaction will be fully debt financed and is expected to be completed by Wednesday, the Bern-based company said.
Vodafone bought the stake in Swisscom Mobile for 4.5 billion francs ($3.68 billion) in March 2001. Last month, Swisscom opened negotiations with the British company to buy it back.
The Swiss government, which still owns more than half of Swisscom's shares, approved the purchase.
WestLB analyst Morten Singleton said that, while the deal was unlikely to have much material impact on Vodafone's results, the company's result was good.
'Swisscom have paid a lot for it, but it's a good price for Vodafone, at the expensive end of the range,' he said.
Company CEO Carsten Schloter acknowledged that the price paid was 'on the high side.' But he said on a conference call that Swisscom expects to increase net income and equity free cash flow annually from 2007 by around 180 million francs ($147.4 million) net, after deduction of financing costs.
© 2006 The Associated Press
© 2006 Dialog, a Thomson business. All rights reserved