No retail redundancies after Vodafone-Three merger, boss says ahead of shop closures
There will be no forced redundancies of retail staff following Vodafone’s acquisition of Three, the firm’s chief executive has said, as the telco giant gears up to find hundreds of millions of pounds of cost savings from the tie-up.
Vodafone chief executive Margherita Della Valle, who spearheaded the bumper £16.5bn merger shortly after taking the reins of the business in 2023, said the high street was still key to the firm’s customer growth.
“From a retail perspective and a property perspective, it’s really important to say that our presence in the high street is really key to our business model… you will continue to see it very strongly,” Della Valle said.
“There will be some duplication but we’ve been very clear… there will not be any redundancies because we really see the high street as a key lever for us.”
Despite the pledge, Della Valle said the merger was still on track to deliver as much as £700m in synergies, which would start to bear out in next year’s numbers.
“50 per cent of that will be the network and IT integration and beyond that I would say strong potential for procurement… and then you have areas such as marketing costs, logistics costs that will also follow,” Della Valle said.
Germany growth disappoints
The remarks come as Vodafone lost more than 70,000 UK mobile customers in the fourth quarter of the calendar year while growth at the firm’s Germany arm fell short of investor expectations.
The FTSE 100 telco said its UK mobile customer contract base declined by 73,000 during the quarter, which it said was driven by the disconnection of around 50,000 of what it called “very low-value business SIMs.”
Service revenue in Germany, the firm’s largest market, rose 0.7 per cent to €2.7bn (£2.3bn), falling short of analysts’ consensus of 1 per cent, according to Bloomberg data.
Vodafone said it had “made a fast start” with integration following its merger deal with Three, which was signed off last year. “Our spectrum and network sharing activation is ahead of plan,” the company said.
Total group revenue rose 6.5 per cent for the quarter to €10.5bn.
Vodafone shares fell 5.1 per cent to 108p on Thursday morning. But the stock is still up by more than 60 per cent over the past twelve months.