Vodafone adds Spanish and Italian broadband

MOBILE phone giant Vodafone has expanded its presence in the broadband market with the £537 million acquisition of firms in Spain and Italy, it emerged yesterday.

The group has paid 775m in cash to Swedish company Tele2 for its operations in Spain and Italy, which provide nationwide fixed-line telephone and broadband services.

The deal continues the group's strategy of increasing its non-mobile services, offering customers broadband and landline services alongside mobile phones.

Tele2's Italian arm had more than 2.6 million customers at the end of June, including 400,000 broadband customers, while the Spanish firm had 550,000 customers, about 240,000 of which had broadband.

Vodafone said the deal enabled it to benefit from the "attractive, high growth" broadband markets in the two countries, where take-up rates are increasingly rapidly. It added that the deal immediately delivered the infrastructure and broadband expertise it needed to offer the service in two of its key European markets.

About 44 per cent of households in Italy are expected to have broadband by the end of this year, up from 30 per cent two years ago. In Spain take-up is forecast at 57 per cent of households in Spain by the year-end.

Arun Sarin, chief executive of Vodafone, said: "We have now established a clear route to delivering fixed broadband services in each of our major European markets."