French billionaire Niel becomes Vodafone’s top investor in $6 billion deal

French billionaire Xavier Niel is set to become Vodafone Group’s largest shareholder after agreeing to buy e&’s 16.2% stake in the British telecom company for about £4.4 billion, or nearly $5.9 billion, putting one of Europe’s most active telecom investors at the top of Vodafone’s register.

The stake will be acquired through Vega, an investment vehicle wholly owned by the Niel family group.

Reuters reported that the deal values the holding at about $5.91 billion and would make Niel Vodafone’s biggest shareholder once regulatory approvals are completed.

The sale ends the Abu Dhabi telecom group’s run as Vodafone’s largest investor.

e&, formerly known as Etisalat, first bought a 9.8% stake in Vodafone in 2022 and later increased its holding. Its exit comes as Vodafone is trying to show that a long restructuring under Chief Executive Margherita Della Valle can translate into stronger returns.

Niel is not launching a takeover of Vodafone. The transaction gives him a large minority position rather than control of the company. Vodafone said Vega does not intend to make a full offer for the group, according to The Wall Street Journal.

Even so, the size of the holding matters. A 16.2% stake gives Niel a significant voice at a company that has been reshaped around fewer markets, larger operating units and a sharper focus on Europe and Africa.

Niel, the founder of Iliad, has built a reputation as a telecom investor willing to challenge incumbents and push consolidation.

Reuters reported that he previously held a 2.5% Vodafone stake through another vehicle and had also tried to buy Vodafone’s Italian business, without success.

Vodafone’s own restructuring has already moved in that direction.

The group has exited Spain and Italy, merged its UK business with Three UK and narrowed its focus to core markets including Germany, Britain and Africa.

Reuters reported that the Three UK merger created Britain’s largest mobile operator.

Vodafone’s FY26 annual report described the company as entering a “new chapter” after a period of significant transformation across its portfolio, capital structure and operating model.

The group reported FY26 revenue of €40.5 billion and adjusted EBITDAaL of €11.4 billion.

The company has continued to simplify its holdings. Vodafone announced the sale of its interests in VodafoneZiggo in the Netherlands for €1 billion in cash proceeds and a 10% stake in a larger Benelux company, Ziggo Group. It also reached an agreement for Vodafone to take full ownership of VodafoneThree for £4.3 billion.

The sale by e& also reflects a change in priorities for the UAE telecom group.

Reuters reported that e& said the divestment reflected the natural evolution of its priorities and would allow it to focus on core businesses while unlocking cash from the investment.

Investors responded positively. Vodafone shares rose as much as 12% in early Friday trading, while e& shares also gained.

The deal also comes as telecom assets in Europe remain under pressure from high capital spending, slow revenue growth and intense competition. Investors have been pushing operators to improve returns, reduce complexity and pursue consolidation where regulators allow it.

Niel’s arrival gives Vodafone a shareholder with deep operating experience in telecom and a record of investing across the sector. His telecom interests include Iliad and other assets across Europe and Latin America, giving him a broader view of markets where scale, pricing discipline and network investment remain central issues.

India remains a separate part of Vodafone’s wider investment story. Vodafone’s FY26 preliminary results listed Vodafone Idea as a joint venture in which Vodafone held 16.1% ownership. Vodafone Idea is not part of Niel’s transaction, which is a purchase of shares in Vodafone Group from e&.

Niel’s purchase does not directly change Vodafone Idea’s shareholder structure or give him a direct stake in the Indian operator. It does, however, place a telecom investor with a large minority position above Vodafone Group at a time when the British company is assessing how best to manage its remaining assets.

Vodafone Idea remains one of India’s major private telecom operators but continues to face a different set of challenges from Vodafone’s European portfolio. The company has been investing in 4G expansion and 5G launches while managing high debt and a shareholder structure that includes the government, Vodafone Group and the Aditya Birla Group.