Proactive Investors - Vodafone Group PLC's (LON:VOD) confirmed on Monday that the merger between its UK telecoms arm and Three UK will no longer require approval from shareholders under new UK listing rules.
Vodafone told investors this in a statement, confirming that the transaction is classified as a significant transaction, which means a vote is no longer needed following the new listing rules coming into force at the end of July.
The board confirmed that, in its opinion, the transaction is in the best interests of its security holders as a whole.
Under the new listing rules, a significant transition can be completed without shareholder approval provided the companies comply with enhanced disclosure requirements, with the burden of decision-making now resting with the company’s board of directors to allow for faster execution of deals. Disclosures must include the effects of the transaction on the company's earnings, financial position, and potential risks
In the short statement, Vodafone went on to note that the deal is expected to have a "broadly neutral" impact on Vodafone's ratio of net debt to adjusted profit on an EBITDAaL basis, is expected to be accretive to adjusted free cash flow from the fourth full year onwards, while being accretive to group adjusted EBITDAaL and increasing total assets and total liabilities.
As for risks, it added that the transaction may not proceed to completion if regulatory or CK Hutchison shareholder approvals are not granted, and that it may incur liability from customary warranties and indemnities as well as ongoing obligations to provide services.