France's Iliad 'made offer' for Vodafone Italy unit - report

Backed by telecommunications billionaire Xavier Niel, Iliad made an offer to Vodafone’s board of directors last week. Speculation of a merger emerged in recent weeks as both companies tried to find a way to end ruthless competition in a tightening market.

Iliad has been looking at expansion options in Italy in recent months as it seeks to agreements in the domestic telecoms sector to accelerate consolidation and end a price war that has cut its margins.

Vodafone is currently looking for merger opportunities in the UK, Spain, Italy and Portugal, its chief executive Nick Read said last week. The UK telecoms major is under pressure after the arrival of activist investor Cevian Capital on its share register.

Iliad is also considering a move to purchase a rival phone carrier in Italy if the opportunity arises, local unit Chief Executive Officer Benedetto Levi said in an interview with Bloomberg in January.

Iliad moved into the Italian mobile services market in 2018 as a no-frills challenger, sparking a price war that last year led to three profit warnings by ex-monopolist Telecom Italia. The news of the Vodafone offer was reported by Bloomberg.