Vodafone Group PLC (LSE:VOD) has completed the sale of its Spain arm to Zegona Communications (LSE:ZEG) plc for €4.10 billion in cash and €0.90 billion in redeemable preference shares.
The total enterprise value of €5 billion (£4.26 billion) represents a multiple of 5.6 times Adjusted EBITDAaL and 13 times operating free cash flow for the twelve months ending 30 September 2023.
As part of the transaction, Vodafone will continue to provide certain services to Vodafone Spain.
The disposal was first announced last October. It forms part of Vodafone boss Margherita Della Valle’s strategy of streamlining Vodafone’s global operations in the face of a burdensome debt pile and lossmaking European operations.
Zegona, which was incorporated in 2015 by former Virgin Media executives Eamonn O’Hare and Robert Samuelson, previously said it hopes to “improve efficiency by reducing complexity and driving productivity”.
Back in 2021, Zegona returned over £300 million to shareholders after exiting its investment in Basque Country telecoms group Euskaltel to Masmovil, which bought at a €3.5 billion valuation.
Vodafone shares were flat at 74.75p in Friday morning trades.