MILAN (Reuters) - Vodafone (VOD.L) is ready to direct a large part of its “Project Spring” investment spend on Italy, Chief Executive Vittorio Colao said in a newspaper interview published on Friday.
Colao was quoted as telling Il Corriere della Sera that Italy becomes Vodafone’s second largest market in Europe following this week’s $130 billion deal to sell out of U.S. joint venture Verizon Wireless, which includes Vodafone acquiring Verizon’s (VZ.N) 23 percent stake in Vodafone Italy.
Under its “Project Spring” plan which follows the Verizon sale, the British company intends to raise its capital spending by an additional 6 billion pounds over three financial years to improve network quality for customers in Europe and emerging markets.
“Italy will have a big part of our Project Spring, to speed up 4G and develop more fiber, ours or in collaboration with Telecom Italia (TLIT.MI) at sustainable prices,” Colao told the newspaper.
“Otherwise we are already equipped and are ready to invest,” he said.
Project Spring is seen putting debt-laden telecoms players like Spain’s Telefonica (TEF.MC) and Telecom Italia under pressure to match Vodafone’s step-up in spending.
NOT EUROPE‘S AT&T
With cash from the Verizon sale swelling its coffers, Vodafone looks set to shake up Europe’s telecoms sector.
“Consolidation is inevitable,” Colao said when asked if just a few players would remain standing.
He also said Microsoft’s 5.44 billion-euro ($7 billion)acquisition of Nokia’s core handset business, “makes strategic sense for everyone”.
But he brushed aside a suggestion that Vodafone was positioning itself to become “Europe’s AT&T.”
“I wouldn’t say we are going to become like AT&T (T.N), because I don’t think we need to copy their strategy,” he said.
Colao also said that doing one of the world’s biggest ever corporate deals had its enjoyable moments.
“To close the deal, (Verizon’s chief executive) Lowell McAdam and I met at Madison Square Garden during a New York Rangers hockey match,” he said.
“We were surrounded by tens of thousands of hockey fans. The rumors were already out, so we said, ‘let’s meet at the most public place in the world so that no one will suspect anything’s up.'” ($1=0.7623 euros)
Reporting by Stephen Jewkes; Editing by Greg Mahlich