CFO Margherita Della Valle takes over the top role as interim CEO while the board looks for a permanent replacement
Multinational telco Vodafone announced Monday that its CEO of four years, Nick Read, will step down at the end of the month. CFO Margherita Della Valle has been appointed interim CEO until a permanent replacement is found; she will continue as CFO as well. The search is underway for a new permanent CEO, and Read will remain on as an adviser to Vodafone’s board of directors through the end of March, 2023, the company said.
“It has been a privilege to spend over 20 years of my career at Vodafone and I am proud of what we have delivered for customers and society across Europe and Africa. I agreed with the Board that now is the right moment to hand over to a new leader who can build on Vodafone’s strengths and capture the significant opportunities ahead,” said Read.
In announcing his departure, Read earned praise from Vodafone Chairman Jean-François van Boxmeer, who recognized the outgoing CEO’s efforts to manage the company through the pandemic.
“[Read] has focused Vodafone in Europe and Africa as a converged connectivity provider and led the industry in Europe in unlocking value from tower infrastructure,” said van Boxmeer.
In August, Vodafone announced plans with Hungarian system integrator 4iG and state-owned holding company Corvinus Zrt to sell its Hungarian business in a cash deal worth HUF 715 billion (US$1.8 billion). The deal excluded Vodafone Intelligent Solutions (VOIS), Vodafone’s strategic technology arm which services 28 countries and operates several regional offices, including ones in Hungary. The companies expected to close the transaction by the year’s end. Read also helmed Vodafone through its recently announced joint fiber broadband venture with Amsterdam-based Altice. The €7 billion network, FibreCo, will be owned 50% by each company and will make fiber to the home (FTTH) available to 7 million German homes, the companies said in a statement.
Despite Read’s successes and the 2021 Vantage Towers spinoff, shares of Vodafone stock remain low, off about 40% from when Read took over in 2018, trading at the lowest levels in nearly two decades. Investors have been especially tepid since November, when Vodafone cut its full-year cash flow forecast and earnings by €200 million (US$211 million) to €5.1 billion (US$5.3 billion). At the time, Read cited growing energy costs and a “challenging macroeconomic environment” to explain the gloomy forecast. The company said it would cut costs to the tune of €1 billion (US$1.06 billion) over the next three and a half years. Vodafone saw a 2.6% decline in adjusted earnings for its first half thanks to worse than expected returns in Germany, while increased competition in Italy and Spain also pushed revenues lower.
Vodafone in November sold off some of those Vantage Tower holdings to create a new venture with investment firms KKR and GIP. The company hopes to net €3.2 billion (US$3.39 billion), which Vodafone said it will use to pay down debt. The companies anticipate finalizing the transaction in the first half of 2023, following customary regulatory procedures.
Closer to Vodafone’s U.K. home, the company announced plans in October to merge with rival British telco Three. Vodafone said that a merger with Three is key to helping the U.K. government achieve its ambitious 5G infrastructure goals.
“By combining our businesses, Vodafone UK and Three UK will gain the necessary scale to be able to accelerate the rollout of full 5G in the U.K. and expand broadband connectivity to rural communities and small businesses,” Vodafone said in a statement.
