Vodafone chief executive Nick Read will step down at the end of 2022, after he failed to halt a years-long slide in the telecommunication giant’s share price, and mergers with major rivals failed to materialise.
Chief financial officer Margherita Della Valle will do the job on an interim basis while the board, led by chairman Jean-Francois van Boxmeer, seeks a replacement. Mr Read, who had been in the post for four years and at Vodafone for more than two decades, will stay on as an adviser until the end of March, the company said.
Vodafone’s share price has sunk about 44% since Mr Read took over in October 2018. In that time, the giant has retrenched and cut debt.
Mr Read’s biggest move may have been to spin out and list the company’s tens of thousands of mobile masts, selling a stake in Frankfurt-listed listed Vantage Towers to a private equity group in a deal that valued the business at €16.2bn last month.
Still, Mr Read struggled to finalise deals that would have reduced the number of players in some of Vodafone’s biggest markets such as the UK, Italy, and Spain. An approach for the Italian business was rebuffed, a key merger opportunity in Spain was missed, and talks with UK rival Three, owned by CK Hutchison Holdings, are public but have yet to conclude.
Vodafone shares were little changed in London trade. The stock remains close to 25-year lows.
Vodafone’s share price has underperformed the rest of the industry this year, even as the sector lost value as a whole, falling more than the Stoxx Europe 600 Telecommunications Price Index.
Its challenges deepened in 2022 after Russia’s invasion of Ukraine sent energy costs soaring, while interest rates also rose. Mr Read faced pressure from investors including Europe’s largest activist fund Cevian Capital, which sold much of its stake earlier this year.
More recently, a vehicle backed by French billionaire Xavier Niel — who owns Eir — bought 2.5% of Vodafone, saying it saw opportunities to accelerate deals and improve profits.
Although major issues such as energy prices and the pandemic were outside of Mr Read’s control, analysts pointed to how he had handled others.
In 2019, he cut the dividend six months after the company said it was affordable. Earlier this year, he missed the company’s most significant opportunity yet to merge its embattled and shrinking Spanish division.
And he has acknowledged poor performance in Vodafone’s biggest business, Germany, following an €18.4bn deal early in Mr Read’s tenure. The acquisition, which included some eastern European businesses, was originally struck by his predecessor, Vittorio Colao.