Activist shareholders pressure Vodafone for overhaul

Vodafone faced more pressure from shareholders today after a former Marconi director led calls for a restructuring at the mobile phone group.

Efficient Capital Structures, which is owned by a group of investors including John Mayo – the former finance director of fallen telecoms equipment maker Marconi – has sent Vodafone a list of resolutions it wants to put to a shareholder vote at the company’s annual general meeting in July.

ECS said the resolutions call for improvements to the firm’s capital structure and the return of up to £38bn (€55.9bn) billion to shareholders.

If passed, Vodafone investors would receive shares that track the company’s 45% interest in US mobile phone group Verizon Wireless, as well as bonds worth up to £34bn (€50bn), or 65p a share.

Glenn Cooper, chairman of ECS said: “Vodafone’s share price has underperformed the FTSE 100 over the past five years by 28%.

“A major reason for this is Vodafone’s inefficient capital structure. Our resolutions aim to rectify that, recognising the long term quality of earnings of the company.

“Vodafone’s utility-like European business can be more efficiently financed while shareholders can benefit from the strong performance of Verizon Wireless, through direct pro rata ownership of Verizon Wireless shares.”