The CEO of a United Arab Emirates government-owned telecoms business is to join the board of Vodafone, the company said today, as it announced a deal to deepen the two firms’ ties.
Hatem Dowidar, boss of e&, which is majority-owned by the UAE sovereign wealth fund, will become a non-executive director at Vodafone in a bid to explore working together on procurement, technology development and jointly offering telecoms services.
E& bought a 10% stake in Vodafone last year and has since boosted its shareholding to 14.6%. Under the terms of the deal, the firm can increase its stake to 25% and will be offered the opportunity to add another exec to the board if its ownership tops 20%.
Dowidar, himself a former Vodafone executive, will retain his seat on the firm’s board for as long as e&’s holding remains at 14.6% or above.
Vodafone boss Margherita Della Valle said: "We know e& well and I’m delighted we have strengthened our existing relationship through this strategic partnership.
“This closer alignment allows us to capture opportunities in our respective markets and brings additional telecoms experience to our Board."
E&, which was founded in 1976 by British communications business International Aeradio, operates telecoms lines between the UAE and its neighbours and is the largest carrier of international voice traffic in the Middle East with a market cap of £44 billion.
The company has faced accusations of censorship in relation to its efforts to restrict access to online content that criticises Islam or that promotes gay and lesbian rights.
Vodafone’s performance has come under intense scrutiny in recent months, with investor concerns over slipping service revenue and profit in its German operations, which contributed to the departure of former CEO Nick Read in December.
Vodafone shares fell 0.7% to 92p. The stock is down 23% over the past year.
