Investors and analysts will on Tuesday get a chance to question Arun Sarin, the chief executive of Vodafone, about the latest spending spree by the world’s largest mobile network operator.
So far this year, Mr Sarin has sanctioned four deals worth just under £4.5bn combined as well as the group’s first withdrawal from a market - Sweden - where it ran a branded Vodafone operation.
In the most recent deal in South Africa, Vodafone is spending up to £1.35bn to raise its stake in Vodacom, the country’s largest mobile operator, from 35 to 50 per cent. This followed swiftly on the heels of an £820m deal to take a 10 per cent stake in Bharti, India’s largest mobile operator, which saw Mr Sarin take Vodafone back to his country of birth.
Earlier this year, he completed a £2.3bn deal in Eastern Europe, which saw the group take ownership of the 79 per cent stake it did not already own in Mobifon, one of the two main mobile operators in the relatively underdeveloped Romanian market, and all of Oskar Mobil, the Czech Republic’s third largest operator.
Around the same time, Mr Sarin did as he had promised and pulled the company out of a market where it could not make a return. The exit from Sweden, which was sold to Norway’s Telenor for just over £700m, and forced a write-down of £500m, went down well with analysts who will be keen to know if the group’s long-suffering Japanese subsidiary might suffer the same fate.
The 51-year-old executive, who has spent just over two years at the helm, will be keen to demonstrate full support and belief in his new management team in Japan but that did not stop him admitting at the last set of results in July that he would “obviously listen” if approached about the business.
It is that sort of candour that the market respects and unless something has gone horribly wrong in the intervening months Mr Sarin is unlikely to renege on his promise of giving his team in Japan until at least the middle of next year to turn things around.
Although merger and acquisition activity grabs the headlines, Mr Sarin, a mobile industry veteran, is unlikely to repeat another mega-deal along the lines of last year’s failed $38bn bid for AT&T Wireless in the US, which went down badly with most investors.
Mr Sarin believes in playing the long game and is focusing efforts on integrating all the disparate Vodafone entities around the world to drive synergies. He knows the industry well having joined Pacific Telesis in 1984, the San Francisco-based company that demerged in the early 1990s to become AirTouch, brought into Vodafone at the end of that decade by his predecessor, Sir Christopher Gent, for £42.7bn in the first of two transformational deals.
Mr Sarin had caught Vodafone’s eye well before that deal, however, having won several European licences from under the noses of the British company while at AirTouch, achievements that earned him the reputation as a deal-maker.
Once within the Vodafone fold he assumed control of US operations, played a central role in securing US shareholder approval for Vodafone’s £101bn hostile bid for Mannesmann. He then negotiated himself out of a job when he oversaw the deal that combined Vodafone’s US assets with Bell Atlantic and GTE to create Verizon Wireless.
He took a back seat as a non-executive director of Vodafone and concentrated on other roles included leading Accel-KKR Telecom, a buy-out specialist, before being asked by Vodafone to take the helm.
But Mr Sarin will need more than his deal-making ability to protect his reputation as he must justify the company’s expensive push into the lastest technology, known as 3G. So far uptake of crucial data-services, designed to reverse margin pressure in the more mature and fiercely competitive markets, has been disappointing.
But he is comfortable with technology, having graduated from the elite Indian Institute of Technology in Kharagpur, before leaving for America to hone his future skills in business at Berkeley, the University of California
There are other clouds gathering over the company, not least the weak share price, with the stock underperforming the FTSE-100 by almost 9 per cent in the past 12 months.
Moreover, there are also concerns about the foray into India. Some analyst fear it could lead to a repeat of the deadlock situation Vodafone faces in two key markets - the US and France - where it has sizeable but minority stakes in operators and the other shareholders are showing no desire to sell.
Bharti is already 31 per cent owned by Singapore’s SingTel, which has indicated it wants to increase its holding after the Vodafone deal. Mr Sarin’s deal-making skills face plenty more tests.