Investor group pushes for breakup of Vodafone

The grouping, headed by an entity called Efficient Capital Structures (ECS), has compiled a list of demands and resolutions that it wants to put to the shareholder vote at Vodafone’s AGM, due to be held on July 24. Sources say the four demands include one calling on the company to increase its debt and return more cash to stockholders, whilst another proposes that Vodafone should cash-in its 45 per cent stake in the US mobile operator Verizon Wireless and give that money to shareholders. In all the group wants Voidafone to release some £38 billion in value. The operator will do no more than to confirm that it has “received a letter claiming to require Vodafone to submit a number of resolutions to the company's AGM on July 24 concerning potential restructuring options for the company.Vodafone will be reviewing the contents of this letter and will be making a further announcement in due course.” In fact the letter does rather more than simply “claim” to require that the resolutions be discussed at the forthcoming AGM. Under UK company law a resolution can be put before shareholders for debate and vote if it either has the support of stockholders with a minimum of five per cent of a company’s shares or the support of 100 individual shareholders. As there are 50 billion Vodafone shares out there in the market even the biggest stockholder (Legal & General) has only a four per cent holding,and it is therefore self-evident that ECS is going down the “100 individual shareholde" route in its efforts to effect root and branch change at the carrier. ECS has some interesting members and rather odd bedfellows they make.