Vodafone AirTouch PLC said today that shareholders in Germany's Mannesmann AG have given a "very positive" response to Vodafone's $127 billion takeover bid.
Vodafone chief executive Chris Gent has ended several days of meetings with German shareholders, part of an effort to persuade them to back his company's offer, the biggest hostile takeover attempt in history.
Mannesmann, a telecommunications and engineering group, has twice rejected buyout offers from Vodafone, the world's largest mobile phone company.
Gent hopes to persuade Mannesmann's management to recommend that its shareholders accept the $245 per share bid Vodafone made on Nov. 19 but also is appealing directly to those same investors.
"Our response has been very positive so far, both to the strategic logic of the bid and to the actual offer we've indicated," Vodafone spokesman Mike Caldwell said of shareholders who own stock in both Mannesmann and Vodafone.
The Times of London on Wednesday quoted Klaus Esser, Mannesmann's chairman, as saying, "Naturally, we do not rule out an amicable solution."
However, Mannesmann spokesman Manfred Soehnlein dismissed reports that Esser may have softened his opposition to Vodafone's bid. Asked whether Esser has toned down his hostility to a deal, Soehnlein replied: "Not at all."
"What he has said is that there is no price that reflects the value potential of the Mannesmann shares and at the same time is affordable to Vodafone shareholders," Soehnlein said.
Mannesmann operates the largest cellular business in Germany. Esser believes its strategy of integrating fixed-line and mobile operations is superior to Vodafone's sole focus on wireless communications.
Mannesmann's supervisory board, which last week turned down Vodafone's sweetened offer, will meet again Sunday to consider the bid in detail.
Another rejection would leave little alternative to a full-blooded battle for control of Mannesmann and domination of Europe's burgeoning telecommunications market.
Mannesmann executives will soon begin a roadshow of their own, with Esser planning to meet with investors Monday in London.
Mannesmann announced Tuesday that it will divest its more sluggish engineering and automotive businesses six months earlier than planned.
Vodafone will make its formal offer to Mannesmann shareholders next month.
The two companies' struggle has become a political issue in Germany, where unfriendly takeovers are almost unheard of. Although Mannesmann has just acquired Orange PLC, a British rival of Vodafone, many German political and labor leaders have rushed to help defend it against Vodafone's hostile offer.
"I do not think that politicians have overreacted," Soehnlein said. "That is a development that affects the interests of many people."