Vodafone will receive $1.8 billion from the sale of a Hungarian unit.

Vodafone will receive $1.8 billion from the sale of a Hungarian unit.
  • Hungarian State sells Hungarian Unit to 4iG

LONDON (Reuters), Jan 9, 2009 – British telecom company Vodafone (VOD.L), announced that it has agreed to sell its Hungarian business and assets to 4iG, a local IT company, and the Hungarian government. The deal would see them receive a cash consideration totaling 1.7 billion euros ($1.82billion).

After the board became dissatisfied with Nick Read’s progress and inability to make the necessary deals or grow the company, Vodafone announced the sale of its chief executive.

Vodafone stated Monday that proceeds of the sale would go towards paying down its debt. Read explains that Vodafone, which was once the largest mobile operator in the world has sold assets to concentrate on its core European operations and Africa operations.

Margherita Della Valle, interim chief executive of the group, stated in a statement that Hungary’s disposal will increase competition and speed up competition in Hungary.

Viktor Orban, the Prime Minister of Hungary will strengthen his control over the sector’s telecoms through this deal. The plan will give 4iG a 51% majority and the Hungarian government 49%.

His influence has been expanded by his nationalist government in such areas as banking, energy and media and, now, telecoms.

This sale will be completed later in the month.

($1 = 0.9361 euros)

Sarah Young Reporting; Kate Holton Editing

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