In Italy, Vodafone has a market share of 28.8% in mobile and 16% in fixed. The acquisition of the Italian branch of the British operator would have allowed Iliad to control more than a third of the mobile market in the Boot.
Iliad will have to wait before becoming a mobile giant in Italy. Free’s parent company failed to get hold of Vodafone’s Italian subsidiary. The British operator has indeed rejected the offer of the group led by Xavier Niel, with the support of the investment fund Apax Partners. Vodafone considered in particular that this offer “is not in the interest of the shareholders”. However, the group from across the Channel indicates that it is exploring “several consolidation opportunities” in its main European markets, including Italy.
It is therefore at the level of the price that the operation got stuck. Iliad has revealed that it has made an 11.25 billion euro acquisition offer to grab Vodafone Italia. In the Boot, the British operator has a market share of 28.8% in mobile and 16% in fixed. If it had fallen into the bosom of Iliad, the French group would have got hold of 18 million customers on mobile and three million on landline. Despite its significant weight, Vodafone Italia has lost four million customers in less than four years.
The acquisition of the Italian branch of the British operator would have enabled Iliad to strike a blow on the telecom market on the other side of the Alps. This would have allowed it to control more than a third of the mobile market in Italy with a combined turnover close to six billion euros. Beyond giving Iliad the leading position in mobile telephony in La Botte, this acquisition would also have been a nice springboard for the French company on the Italian fixed telephony market, where it made its debut there two weeks ago with the launch of a first Internet box.
8.5 million customers for Iliad in less than four years
Present in Italy since 2018, the French group now claims 8.5 million mobile customers, allowing it to gain a 10.5% market share in this segment. As in France in 2012, the parent company of Free has bet on a strategy of offers at bargain prices to find a place in the Italian telecom market. The three other operators, Tim, WindTre and therefore Vodafone, felt the full brunt of the effects of this new competition, when they had to invest large sums to buy frequencies and deploy the necessary infrastructure for the arrival of 5G.
In strong growth thanks to its very aggressive pricing policy, Iliad is aiming for a turnover of one billion euros in 2022 in Italy. And if Vodafone preferred to kick in touch against the proposal of the French group, the latter does not intend to reduce its ambitions on the Italian market. The boss of Iliad Italia, Benedetto Levi, has also made no secret of the operator’s desire to strengthen itself by exploring the possibilities of taking over another mobile operator. But whether with Vodafone or another player, the maneuver seems very difficult to carry out, insofar as the regulators would take a dim view of the transition from four to three operators in the country, which would curb a price war beneficial to the consumers. The consolidation of the sector is therefore not for now.