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Vodafone CEO to leave in October after a decade
VODAFONE Group plc chief executive officer Vittorio Colao is stepping down, announcing he will leave following a decade at the helm of the mobile-phone company a week after sealing his biggest purchase yet following a prolonged period of retrenchment.
Mr Colao, 56, leaves the world's second-largest mobile carrier in October and chief financial officer Nick Read, 53, will take over, Vodafone said in a surprise statement as it reported earnings that beat estimates.
Margherita Della Valle, currently deputy CFO, will succeed Mr Read as CFO. The shares fell the most since February. Vodafone's US$22-billion agreement last week to acquire cable assets in Europe from Liberty Global plc allows Mr Colao to leave Newbury, England-based Vodafone with a landmark purchase to round out his years reshaping the company as a predominantly European carrier, with the mix of mobile and fixed assets needed to sell bundled services.
Mr Colao's tenure has been largely characterised by Vodafone pulling away from markets outside Europe where his predecessors sought growth, including an agreement last year to merge the company's Indian operations with Idea Cellular Ltd - seen by investors as a prelude to a likely exit.
"Now is the right time to begin the transition," Mr Colao said on a call with reporters. "The chapter that Vodafone is now starting to write is a completely new chapter - after India, after Liberty, with the big in-road into convergence. It will be the right time to start with a new dedicated management team."
Vodafone shares dropped as much as 3.5 per cent and were down 3 per cent to 201.05 pence as of 8:02am in London.
While the timing couldn't have been anticipated, the handover from the Italian executive to Mr Read will give investors a familiar face in the Briton. Before CFO, Mr Read had previous roles heading up the company's emerging markets and UK divisions.
But the October succession means that Mr Read will be left to see through Mr Colao's legacy-building deal to acquire Liberty Global's German and Eastern European businesses, which isn't guaranteed to pass regulatory muster to close by mid-2019, as expected. For Mr Read it's a "step-up" role, after a good track record at Vodafone, said James Ratzer, a telecom analyst at New Street Research in London.
"This is actually a very orderly succession process," Mr Ratzer added. "Colao has decided to leave before people have been saying: 'You've been in the job too long."'
Vodafone on Thursday gave its outlook for next fiscal year, forecasting 2019 organic adjusted earnings before interest, taxes, depreciation and amortisation of between 14.15 billion euros (S$22.5 billion) and 14.65 billion euros, compared with the average estimate of 14.6 billion euros. BLOOMBERG