Vodafone buys Spain's Ono in £6bn deal

Vodafone has agreed to buy Ono, the Spanish cable and telecoms operator, in €7.2bn (£6bn) deal.

The acquisition is the British mobile phone operator's first major deal since completing the $130bn (£78bn) sale of its stake in US mobile network Verizon Wireless this year.

Ono has the largest next-generation network in Spain offering high-speed broadband, pay-TV, fixed and mobile telephone services. Its network covers 7.2m homes and 1.9m customers and the company made a pre-tax profit of €1.1bn last year.

Vittorio Colao, the chief executive of Vodafone, said: "The combination of Vodafone and Ono creates a leading integrated communications provider in Spain and represents an attractive value creation opportunity for Vodafone.

"Demand for unified communications products and services has increased significantly over the last few years in Spain, and this transaction – together with our fibre-to-the-home build programme – will accelerate our ability to offer best-in-class propositions in the Spanish market."

Vodafone expects to achieve cost savings of around €240m (£200m) before integration costs by the fourth full-year after completion of the deal.

The acquisition values Ono at 7.5 times its 2013 EBITDA.

José María Castellano Ríos, the chairman of Ono, said: "As part of Vodafone, Ono will continue to seize new growth opportunities and deliver the quality that our customers expect. The enlarged business is also expected to drive innovation in the Spanish telecommunications industry."

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