French billionaire Xavier Niel snaps up a 2.5% stake in struggling Vodafone worth £750m


French billionaire Xavier Niel snaps up a 2.5% stake in struggling Vodafone worth £750m

A French billionaire has snapped up a 2.5 per cent stake in Vodafone, worth £750million.

Xavier Niel is the second French tycoon to swoop on a British telecoms company after Patrick Drahi built an 18 per cent stake in BT.

Niel, 55, is renowned for his ruthless activism in France and his foray onto Vodafone’s share register paves the way for a shake-up at the underperforming telecoms giant.

Renowned: Telecoms French tycoon Xavier Niel (pictured with partner Delphine Arnault) has paid £750m for has snapped up a 2.5% stake in Vodafone

The Frenchman is best known for owning Iliad, a smaller European competitor. But he built up his Vodafone stake through his investment vehicle Atlas.

Niel said he was supportive of Vodafone’s strategy and its ‘publicly stated intention to pursue consolidation opportunities in selected geographies, as well as its efforts in infrastructure separation’.

But analysts warned his strategy was not yet known and it remains to be seen if the billionaire will add to his stake and ask for representation on the board.

Under chief executive Nick Read, Vodafone has struggled to grow and failed to complete meaningful merger and acquisitions transactions.

As a result, it has become a target for activist investors with Swedish hedge fund Cevian, run by Christer Gardell, taking a stake in January and Coast Capital building a position in February.

Cevian has called for Read to shed poorly performing parts of the business.

Niel becomes the third activist investor this year, and Read’s position now looks increasingly vulnerable.

Two years ago Niel helped oust the boss of a French property firm, change the group’s strategy and join the board.

One City analyst said: ‘He’s a disrupter. He’ll try and shake things up. To be honest, it is much needed at Vodafone.’

Niel made a fortune from pornography and peep shows, and is worth an estimated £7billion. 

He is renowned in French social circles and his partner is Delphine Arnault, daughter of France’s richest man, Bernard Arnault, and heiress to luxury conglomerate LVMH.

The UK’s telecoms sector has become a magnet for French billionaires with Drahi building an 18 per cent stake in BT last year, causing alarm bells to ring in Westminster amid fears that key infrastructure could fall into foreign hands.

Shares in Vodafone rose 2.3 per cent, or 2.4p, to 108.78p.

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