Vodafone says door is open to new deals!

Vodafone would consider a transformational M&A deal at the right price in the future, according to its chief executive speaking at a New York investor conference.

Vittorio Colao said that efforts to invest in the company’s networks as well as wider consolidation moves in the industry would leave Vodafone in a better position to engage in dealmaking in the longer term.

Vodafone has been linked with a number of large telecoms and media groups such as Liberty Global and AT&T in the past year after the company sold its stake in Verizon’s US business.

The company has used some of the proceeds to fund investment to improve its mobile networks under the so-called “Project Spring” initiative, as well as support acquisitions of cable businesses to further its ambitions in joining fixed line services to its wireless business.

Vodafone has acquired Cable & Wireless Worldwide, Ono and Kabel Deutschland in the past three years in Europe and partnered with other fixed line providers, which will help package mobile, broadband and TV content in bundled deals for customers.

But Mr Colao used the conference to point to a potential threat to its business in the UK from a similar strategy from BT expected later this year. BT is expected to offer discounted mobile deals to its customers to help sell its core broadband services.

Mr Colao fired a warning shot at BT by saying a deeply discounted mobile offer from BT would likely trigger equally aggressive responses in the fixed broadband market, not just from Vodafone but from other mobile operators.

Mr Colao told the Goldman Sachs Communacopia conference that the European economy was showing marginal signs of improvement but cautioned that a strong recovery was unlikely. He also said that Vodafone’s business in Germany was stabilising, and pointed to robust growth in India and in its other emerging markets.

He added that European regulators needed to focus more on the industry’s low return on invested capital. He was hopeful that the new EC commissioners would take this into account, adding that merger approvals should be given unconditionally rather than watered down with remedies giving wholesale access to networks.

On Wednesday, Günther Oettinger was appointed as the commissioner for the digital economy, replacing Neelie Kroes, which was seen as favourable for companies in the sector given German telecoms regulation has tended to favour consolidation to support industrial strength.