Runaway success

9 November 2010 By Una Galani Follow @ugalani

The UK telco’s shares have outperformed, rising 24 pct in six months as Vodafone has responded to investor criticism by streamlining its portfolio. The sale of its interests in Japan’s SoftBank for 3.1 bln pounds is more good housekeeping. But there are bigger prizes to come.

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Vodafone on Nov. 9 raised its operating profit outlook and said it would generate proceeds of 3.1 billion pounds ($5 billion) from the disposal of its interests in Japanese rival SoftBank further streamlining the group's portfolio.

The UKbased telecom operator will receive the SoftBank proceeds in two tranches. Vodafone will get 1.6 billion pounds in December this year that will be used to pay down debt. The remainder will be received in April 2012.

Before the agreement, the earliest maturity date for loan note would have been in 2013. The face value of the instrument was roughly 3.2 billion pounds, according to a person close to the company.

Operating profit for the year ending in March will now be 11.812.2 billion pounds, up from between 11.212 billion pounds.

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