Vodafone to buy Germany's biggest cable operator Kabel Deutschland

UK mobile phone firm makes its first move into consumer broadband and television in one of the biggest telecoms deals in recent years

Vodafone has agreed to buy Germany's biggest cable company for €7.7bn (£6.6bn) in a deal that sees the UK mobile phone firm make its first move into consumer broadband and television.

The deal has been approved by the board of Kabel Deutschland but could become the subject of a bidding war with US firm Liberty Global, which owns Germany's second biggest cable firm Unity Media.

Vodafone has offered €87 a share, valuing the business at €7.7bn, an increase on an informal offer of €82 a share made two weeks earlier. It will also take on the company's debt of £2bn.

Chief executive Vittorio Colao said: "German consumer and business demand for fast broadband and data services continues to grow substantially as customers increasingly access TV, fixed and mobile broadband services from multiple devices."

Vodafone makes offer for Germany's biggest cable operator, Kabel Deutschland. 

He added that the deal is "consistent with Vodafone's broader strategy of providing unified communications services."

The company has been keen to move into the cable market and wants to tap into "quad play", offering TV, broadband, telephone and mobile.

Colao said the price was "full and fair" believing the company could make cost savings of €300m a year, eventually saving €3bn. The Kabel Deutschland management team would remain in place to run the fixed line business.

The company has 8.5 million customers and its cables pass 15.3m German homes.

If the deal goes through, it would be one of the biggest in the telecoms industry in several years and comes 13 years after Vodafone's first foray into Germany, when it bought mobile phone network Mannesmann for £101bn.

The company will be hoping for better luck with this bid after a move to merge with a Greek rival fell through, and an expansion into Burma ended due to high start-up costs.

It comes a month after Vodafone signed a rental agreement with Deutsche Telekom for its cable capacity, and a year after Vodafone's first fixed-line takeover of business and wholesale provider Cable & Wireless Worldwide last year for £1bn.

However, Colao said the Deutsche Telekom deal, which passes many of the same homes as the Kabel Deutschland cables, would remain in place.

He said: "It won't affect the wholesale agreement. Deutsche Telekom will remain an important deal with us and we will remain important partners with Deutsche Telekom."

Industry analysts have suggested this deal could be followed by bigger acquisitions as the telecoms giant looks to secure its own future and risk any possible takeover.

However, Vodafone played down any future takeovers. Colao said: "I wouldn't have any read across this deal and clearly every situation is different. The intention is to reach homes and offices and I would not comment on any other market.

Its US partner, Verizon, has said it wants to buy Vodafone's 45% stake in Verizon Wireless – worth around $130bn– which could leave Vodafone vulnerable to a takeover. A $100bn offer was rejected by Vodafone two months ago.

The Kabel Deutschland chief executive, Adrian von Hammerstein, said: "Together, we have the opportunity to become Germany's leading telecommunications and television provider and to create what for the German market is a unique, winning combination of fixed line and mobile communications."

The company's revenues hit €1.83bn in the year to the end of March, with pretax profits of €226m.

Article Source : http://www.guardian.co.uk

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Barclays to sell customer data

Bank tells 13 million customers it is to start selling information on their spending habits to other companies

Barclays is to start selling information about 13 million customers' spending habits to other companies, and has admitted it could share the data with government departments and MPs.

In letters being sent to customers, it is also outlining what details about them it holds and uses which, it said, "may include images of you or recordings of your voice", as well as comments made in interactions with the bank on social media sites such as Twitter and Facebook. Barclay ssaid it may collect "location data derived from any mobile device details you have given us" - suggesting it will be able to pinpoint where in the world a customer is at a particular moment in time.

However, the bank assured customers that any data it passed on to third-party companies would be aggregated to show trends, and that individuals would not be identifiable from it. A spokeswoman said there was "nothing sinister" going on, and added that it would not be profiteering from customers. Like most companies, Barclays has previously used customer data internally, but it has not shared it with third parties before. It is writing to current and savings account customers to let them know about the changes, which will take effect on 9 October.

Barclays said the data would be aggregated to show trends and individuals would not be identifiable

A leaflet details the "new ways" in which Barclays' companies can use customer data, stating: "We can combine information about you with information about other Barclays customers to create reports which we may share with companies outside Barclays. This information is numerical and not personal, and you will never be identifiable on the basis of it." This could include data on how much people spend on different products and services.

The bank said the data could be passed to government departments and MPs – for example, to give them an insight into what was happening in their constituency.

In a statement the bank said: "We only use information in a numerical, anonymised and aggregated way, as is standard practice at many companies. It is not about providing information for sales or marketing use and does not include any personal data."

It said the move was in accordance with industry guidance from the Information Commissioner's Office and the law. "Customers are always able to opt out of marketing activity and their personal data will never be passed on to anybody else without their explicit consent," it added.

The bank said that data relating to where a mobile phone was at a particular time would be used for fraud prevention purposes, and only when a transaction was picked up by its fraud detection systems. It would confirm "at a country level" if the customer was in the region where the suspicious transaction had taken place. Customers will be able to opt out of this if they wish.

Barclays is the latest in a line of companies to come under scrutiny over the way they use customer information. It emerged recently that Tesco is using data about what Clubcard holders buy in its stores to serve targeted ads to online users of its new movie streaming site, Clubcard TV. Tesco also plans to use its Clubcard data to tackle obesity by offering customers "tailored suggestions for how they could shop more healthily".

Financial companies have different policies when it comes to the use of people's data. For example, MasterCard states in its global privacy policy that it will "perform data analyses" and offers the chance to opt out on its website. Otherwise, people are automatically opted in.

Article Source : http://www.guardian.co.uk

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Five questions MPs should ask Bank of England governor Mervyn King

MPs should keep their questioning robust when the outgoing governor makes his final appearance in parliament

Mervyn King has enjoyed many congratulatory farewells ahead of his departure next month as governor of the Bank of England, but maybe MPs could stick to the robust questioning that is their hallmark when he appears in parliament for the last time on Tuesday.

Five questions that he should answer are:

• Should the government press ahead with the privatization of Royal Bank of Scotland or its break-up?

• Barclays and Nationwide have missed targets for capital – the new so-called leverage ratios – according to the new regulator. What is the deadline for meeting the ratios, is it earlier than the internationally agreed date of 2019?

Mervyn King speaks at his final Mansion House dinner as Bank of England governor

• Is it inconsistent to want easier credit while imposing tougher lending rules on banks? For the sake of the economy, should we not make it easier to lend, not harder?

• How would you like the MPC's remit to evolve under Mark Carney? Is there a single new policy initiative that your successor could adopt to improve the BoE's management of monetary policy?

• Can you explain how austerity has worked when growth has flatlined for three years, real wages are falling and the debt burden is higher?

Article Source : http://www.guardian.co.uk

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