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Vodafone’s new Chief Executive Margherita Della Valle is leading a turnaround of the group, and as part of that is seeking to improve performance in its largest market, Germany, where it has lost customers.
Shares in British company Vodafone rose 3% in London and 1&1 soared 15%, set for its biggest one-day gain since 2008. 1&1, the mobile phone operation of German internet provider United Internet, is building a fourth mobile network.
The deal knocked shares in Telefonica (NYSE:TEF) Deutschland, as 1&1 teamed up with its competitor Vodafone. Shares in Telefonica Deutschland’s parent company Telefonica also slumped more than 7% in Madrid.
Vodafone said in its statement on Wednesday that the commercial agreement with 1&1 was for 18 years, and would start to deliver the 5G coverage to 1&1 customers from the second half of 2024.
It added that wholesale costs would be indexed to Vodafone’s mobile network cost to reflect the impact of inflation and technological developments.
