Vodafone’s staff in Spain has not finished digesting the resignation of its current CEO, Colman Deegan, who announced his departure this Thursday. The sources consulted by THE OBJECTIVE indicate that this movement The uncertainty experienced by its workers in recent months has increased and adds clouds to the future of the company in our country. Nobody knows what will happen in the medium term – not even the senior managers – nor the plans that its parent company in London has for the new management team, but they warn that the current situation is not optimal.
These same sources consider that there may be a long period of slowdown in the company’s operational progress while waiting for new leadership. The group’s idea is to have a replacement for Deegan in a few weeks and before the British manager formally leaves his post at Vodafone Spain. Nevertheless, this process will overlap with the search for a replacement for its CEO, Nick Read, that he announced his resignation at the beginning of December, and that it may take several months.
In this way, the CEO who arrives in Spain in March will not be appointed by Read’s replacement, but by the financial director Margherita Della, who took over the reins of the operator on an interim basis. The sources consulted indicate that this will stop any type of sudden movement or swerve in our country, since in all scenarios the plans of the new world CEO, who will have the Spanish subsidiary among his priorities, will be expected to be known.
Nevertheless, The company reminds us that the operator’s roadmap in Spain is continuing. Deegan put the transformation plan into action reset, focused on the search for structural changes, capturing new business opportunities and rationalizing costs looking for a more competitive, efficient, digital and agile model. A plan that began its second phase in the middle of last year, focused on reforming its commercial offer, its commitment to the business market, the deployment of 5G and business diversification, and which continues to develop regardless of whether or not there is a CEO
In any case, Among Vodafone workers there has been a feeling of uncertainty for weeks in the heat of the series of movements that are taking place in the company at an international level. The negotiation to merge with Three, the sale of its business in Hungary, the failed integrations in Spain and Italy, the pressure from the Iliad, Vanguard and Blackrock funds for the company to drop ballast, the sharp fall on the stock market in recent weeks and the aforementioned resignation of its global CEO, have created a cocktail that has impacted the sentiment of the workforce in Spain.
Among the workers there is no certainty that there is a specific plan for Spain in the long term from London and -after eight ERE in 20 years and three since 2015- the ghost of an exit of the British operator from our market returns to plan. On the other hand, the decision to include Vodafone Spain under the umbrella of the European cluster has the reading that this division has lost weight in the face of the global matrix. Until now, it reported directly to the CEO in London and now this will happen with Serpil Timuray, the current head of the cluster.
Departure of Colman Deegan
In other words, Vodafone Spain goes from being one of the key markets to one more subsidiary, which is comparable to all areas of the continent, although the company reduces this situation by indicating that in the new organization chart there is no longer any European subsidiary who reports directly to London.
What is a reality is the complex future that is opening up in the Spanish market after the departure of Colman Deegan, a “personal” decision and to “undertake new projects outside the sector”, according to sources close to this newspaper. Vodafone has been fighting against low cost in Spain for five years and, despite the fact that it has joined this battle with similar weapons, it has not managed to stop the fall in its customers or its income.
Deegan took over the reins of Vodafone in Spain (in November 2020 and in the middle of the pandemic) when the company had semi-annual revenues of 2,050 million, until leaving it at the current 1,965 and its adjusted Ebitda went from 488 to 445 million. By segment, its revenues from mobile lines went from 1,253 to 1,215 million in this same period and those from services fell from 1,880 to 1,782 million.
Regarding clients, Vodafone has gone from 3.2 million broadband lines to 2.9 million and from 2.3 to 2.2 million convergent customers. On the positive side, it gained 400,000 mobile lines and its broadband footprint grew from 10.5 to 10.6 million homes. In other words, Vodafone is today a smaller company with less income and customers. And also with the question of knowing what will happen to its fixed network, currently in a process of sale or search for opportunities to monetize it.
In the company they recognize that the picture of the last two years is not good in terms of results, but they indicate that the changes and adjustments made in recent months will begin to be noticed in this course, after the increase in service prices and a slowdown in commercial activity. Paradoxically, the legacy of the Briton was the promise of returning to profitability and growing revenue in the 2023 academic year, but he will no longer be around to hang this medal.
However, above these analyzes is the question of knowing what will be Vodafone’s place in the Spanish market once the merger between Orange and MásMóvil materializes. Deegan dedicated a good part of his two years at the helm of the operator to attempt a merger with MásMóvil which, although it was decided in London, took up a good part of his time and conditioned his entire strategy and plans in the medium and long term.
Vodafone began to draw up a strategy in which it could have been the owner of half of the second Spanish operator -above Orange- and He has had to settle for continuing to be third and already a long way from second (the new Orange-MásMóvil). A position that must be defended in the event that one of the current small operators such as Avatel, Finetwork or Digi acquires the assets that the company eventually has to dispose of. joint venture of the French.
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