Sale of Vodafone: Sharpening The Investment Case

Research evidence excerpt

Sale of Vodafone: Sharpening The Investment Case

MENA | Telecom Services

e& EquityJulyResearch12, 2026

FLASH NOTESale of Vodafone: Sharpening The Investment

RATING BUYCase

PRICE AED20.70^

The Vodafone disposal continues e&'s strategic shift toward simplifying the

portfolio, monetising noncore assets, and improving earnings quality. While the PRICE TARGET | % TO PT AED23.00 | +11%

investment likely delivered only a mid-single-digit IRR (~5.5%), the AED22bn 52W HIGH-LOW AED21.60 - AED17.40

cash inflow should materially strengthen the balance sheet, lifting flexibility for FLOAT (%) | ADV MM (USD) 40.0% | 93.82

shareholder returns. With leverage set to fall well below management's cap and MARKET CAP AED180.0B | $49.0B

limited M&A appetite visible, we see further upside risks to DPS. TICKER EAND UH ^Prior trading day's closing price unless otherwise

noted.

What's new? Today, e& announced it has signed a binding agreement with Vega, a vehicle of the Niel

family group, to divest its entire holding of 3,945m VOD shares (16.2% of share capital and 17.1%

of voting rights) for 112.5 GBp/sh (c.110.5 GBp/sh paid in cash by the buyer, 13% above Thu close, Exhibit 1 - e&'s investment in Vodafone

and VOD's final FY26 divi of 2.02 GBp/sh to be received on 30 July 2026). Upon completion, the 110.5 GBp/sh paid by Vega is below our

transaction is expected to generate cash proceeds for e& of c.AED21.8bn (US$5.95bn). The shares estimated blended acquisition price of c.119

will be sold simultaneously through off-market block trades to three financial institutions, which will GBp; however, combined with FY22-FY26

dividends and GBP appreciation, that drives

hold them until Vega completes required regulatory approvals. According to e&, the decision reflects 5.5% IRR