PREVIEW-Investors seek news on more Vodafone asset sales

* H1 results due on Nov. 9

* Investors keen for news about portfolio streamlining

By Kate Holton

LONDON, Nov 4 (BestGrowthStock) – Vodafone (VOD.L: ) investors will be
looking for further signs that the group will dispose of
minority stakes and return much of the proceeds to shareholders
when it reports first-half results and updates its strategy.

Shares in the mobile operator have risen more than 16
percent since it announced in July it planned to update its
strategy, with much of the gain coming since it sold its 3.2
percent stake in China Mobile (0941.HK: ) for $6.6 billion in
September. [ID:nTOE68702E]

Investors, some of whom complained that Vodafone’s strategy
of owning non-strategic minority assets weighed on the group’s
overall value, will be hoping for something similar with regard
to Vodafone’s presence in France and Poland.

“It is not an accident that the Vodafone share price has
performed so well since the China Mobile deal and its
shareholder remuneration were announced,” Bernstein analyst
Robin Bienenstock said.

“The company’s decision to use 70 percent of the proceeds
for a share buyback and the rest to pay down debt addressed one
of the largest issues facing Vodafone — scepticism over
portfolio management and allocation of capital.”

News of Vodafone’s strategy review followed investor calls
for a shake-up at the board and came before a small rebellion at
its annual general meeting over its recent performance.

Vodafone’s 44 percent stake in SFR, its French joint venture
with Vivendi (VIV.PA: ), and its near 25 percent stake in Poland’s
Polkomtel are likely to be sold next, analysts and bankers
believe. [ID:nLDE69I0QM]

The Polish unit is complicated by the nature of the
ownership, and any sale to Vivendi will come down to tough price
negotiations, meaning most analysts will look for an indication
of the company’s intentions rather than any immediate progress.

“Although we expect concrete progress in asset disposals
only later this year or early next year, the strategy update
should increase confidence in further measures and thus have a
positive effect,” UniCredit analyst Thomas Friedrich said.

It is expected to keep its most prized asset, a 45 percent
stake in No. 1 U.S. mobile service Verizon Wireless. It can only
sell to majority partner Verizon (VZ.N: ), which has indicated the
unit could start paying a dividend from 2012. [ID:nN23147421]

It also also likely to keep a 4.4 percent stake in Bharti
Airtel (BRTI.BO: ) because the stock is illiquid and hard to sell.

Investors will also be looking for details on how Vodafone
intends to keep the provision of data services profitable
despite ongoing requirements for network upgrades.

Away from the strategy, Vodafone will also have to deliver
solid first-half results with improving trends in Europe after
better-than-expected trading from peers including France Telecom
(FTE.PA: ) and KPN (KPN.AS: ).

Investors and analysts will be looking for strong growth
from the sale of data services, such as accessing the Internet,
and signs of improvement in European markets including Spain,
whose construction sector collapse caused Vodafone problems.

Analysts expect it report earnings before interest, tax,
depreciation and amortisation of 7.29 billion pounds, down from
7.5 billion a year earlier, on revenue of 22.33 billion pounds,
slightly above the 21.8 billion pounds posted in 2009, according
to a Thomson Reuters I/B/E/S poll of eight brokers.
(Editing by Michael Shields)

PREVIEW-Investors seek news on more Vodafone asset sales