Vodafone in Trouble |
ICMR HOME | Case Studies Collection
» Business Strategy Case Studies |
||||||||||
"Vodafone used to be viewed as a growth stock; now people are hard pressed to see where the growth will come from." 1 - Jim McCafferty, Head of Research, Seymour Pierce2 in 2006. "I am not in that camp at all, but nor do I believe that we are in the go-go years of the past."3 - Arun Sarin, CEO, Vodafone Group plc, reacting to the reports that the company had gone ex-growth4 in 2006. Vodafone's Impairment ReviewOn November 15, 2005, Vodafone Group plc (Vodafone), the leading mobile telecom company in the world, announced that it had registered lower profit margins in its Japanese business for the first half of 2005-06 compared to the profits earned for the same period in the previous fiscal year.
In this review, Arun Sarin (Sarin), CEO, Vodafone, announced that there would be a material impairment in the carrying value of goodwill in the range of £23 billion to £28 billion on some of its assets. A significant amount of goodwill was written off on the value of Mannesmann. According to analysts, Vodafone had paid too much for the acquisition of Mannesmann in 2000 when the share prices of telecom companies were higher than their share prices in 2006.
Vodafone in Trouble - Next Page>>
1] Richard Wachman, Heather Connon, "Vodafone's shrinking world view," www.guardian.co.uk, March 5, 2006.
|
Case Studies Links:-
Case Studies,
Short Case Studies,
Simplified Case Studies. |