Vodafone Group has arranged to sell a 100% stake in Vodafone New Zealand to a consortium of investors for NZ$3.4 billion ($2.23 billion).
The consortium comprising New Zealand infrastructure investment company Infratil and Canadian investment company Brookfield Asset Management have executed a conditional agreement to buy out Vodafone's New Zealand subsidiary.
Under the agreement, Infratil and Brookfield will each contribute NZ$1.03 billion towards the purchase price, with the remainder to be funded through debt reduction and equity conversion.
Vodafone New Zealand is the market's largest mobile operator and second largest retail fixed broadband provider, with over 1,500 mobile sites and over 10,000km of cabling nationwide. The operator generated revenue of NZ$2 billion for the financial year ending in March.
Pending approvals from New Zealand's Overseas Investment Office and Commerce Commission, the merger is expected to close by the end of August.
Upon completion of the merger, Vodafone Group and the new owners of Vodafone NZ plan to enter a multi-year partnership that will cover arrangements such as preferential roaming deals.
The partner agreement is also expected to give Vodafone NZ access to Vodafone Group's global IoT platform and centralized procurement agreements.
Vodafone NZ CEO Jason Paris described tha greement as the “best of both worlds” for its customers.
“We’ve got the backing of two new world class and long-term investors plus we can continue to tap into Vodafone’s global expertise, including all the services our customers value such as global roaming, global procurement and the world’s largest IoT platform,” he said.
“The key things will stay the same – our strategy, our people, our management team, our brand, and our ability to tap into Vodafone’s global products and services. What changes is our owners, who back our ambitious plans for New Zealand and who share our views on the importance of creating sustainable, long-term profitability in order to reinvest in the future.”