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Vodafone international strategic development - Essay Example
Author : carrollbridget
Pages 18 (4518 words)
Vodafone international strategic development (Name) (Institution) (Course) (Tutor) (Date) Introduction Vodafone Group PLC was the leading cell phone service provider in the world in 2006. It had over 150 million customers worldwide in 26 different countries and employed around 67 000 people (Johannes and Ashok, 2009, P.271)…
The initial acquisition move of the company was a merger with AirTouch Communications Inc. of the United States in a $61 million deal. The company briefly renamed itself as Vodafone AirTouch in a gradual move towards aligning AirTouch to its global strategy (Johannes and Ashok, 2009, P.263). The company’s North American branch was integrated into a new entity branded Verizon Wireless together with Bell Atlantic’s mobile business with the company retaining 45% stake in the new venture. Verizon wireless was the largest mobile phone operator in the North American market with 36 million customers and 24% market share in 2003. The targeting of large firms is in line with literature that suggests that large scale acquisitions provide potential scale economies and are expected to outperform small scale acquisitions (Risberg, 1999, P.76). The targeting of large firms is also observed in the acquisition of Mannesmann in a deal that helped it own D2 mobile phone business, which was the private market leader in Germany. This deal made Vodafone one of the 10 largest companies in the world helping it achieve scale and scope economies (Johannes and Ashok, 2009, P.264). ...