E& takes seat on the board as Vodafone enters strategic relationship

Vodafone said on Thursday that it has entered a strategic relationship with its largest shareholder, Emirates Telecommunications - also known as e& and formerly known as Etisalat - which will see the company’s chief executive take a seat on the board.

E& first took a stake in Vodafone in May 2022 and now owns a 14.6% interest.

As part of the new collaboration, Vodafone and e& will explore jointly offering cross-border digital services and solutions to multi-national customers and public sector organisations. Services will include fixed and mobile connectivity, Mobile Private Networks, IoT, cybersecurity and cloud-based services.

In Procurement, Vodafone and e& will seek to share best practice and may adopt joint procurement. In Carrier, Wholesale & Roaming, the two operators will work together to become the partner of choice in providing access to high-quality digital infrastructure.

Finally, in Technology, both teams will seek to work together on a technology roadmap, including the evolution and adoption of OpenRAN, Vodafone said.

Under the terms of the relationship agreement, e&’s chief executive will join the Vodafone board as a non-executive director for as long as the Emirati group maintains its current shareholding. In addition, e& will have the ability to nominate a second non-executive director, independent of e&, if its shareholding exceeds 20%.

Vodafone chief executive Margherita Della Valle said: "We know e& well and I'm delighted we have strengthened our existing relationship through this strategic partnership.

"This closer alignment allows us to capture opportunities in our respective markets and brings additional telecoms experience to our board."

Russ Mould, investment director at AJ Bell, said an agreement is in place for Emirates not to take that stake beyond 24.99% "but one has to speculate that greater collaboration between the two groups might ultimately lead to a takeover of Vodafone".

"Its share price has been in the doldrums for years, so being taken private might be the best outcome for long-suffering shareholders."