CHAPTER 1 INTRODUCTION

INDUSTRY INTRODUCTION

Vodafone is a mobile network operator headquartered in Berkshire, England, UK. It is the largest mobile telecommunications network company in the world by turnover and has a market value of about 75 billion (August 2008). Vodafone currently has operations in 25 countries and partner networks in a further 42 countries. The name Vodafone comes from Voice data fone, chosen by the company to "reflect the provision of voice and data services over mobile phones." As of 2006 Vodafone had an estimated 260 million customers in 25 markets across 5 continents. On this measure, it is the second largest mobile telecom group in the world behind China Mobile. Vodafone has won over 391 million subscribers as of September 2011. In the United States, Vodafone owns 45% of Verizon Wireless. Vodafone was formed in 1984 as a subsidiary of Racal Electronics Plc. Then known as Racal Telecom Limited, approximately 20% of the company's capital was offered to the public in October 1988. It was fully demerged from Racal Electronics Plc and became an independent company in September 1991, at which time it changed its name to Vodafone Group Plc. Took over Hutch in India for $11.1bn in 2005. Since then catering customers demand in India. Vodafone has a primary listing on the London Stock Exchange and is a constituent of the FTSE 100 Index. It had a market capitalization of approximately 89.4 billion as of 23 December 2011, the second-largest of any company listed on the London Stock Exchange. It has a secondary listing on NASDAQ.

ORGANIZATION HISTORY

Vodafone's original logo, used until the introduction of the speech mark logo in 1997 In 1982 Racal Electronics plc's subsidiary Racal Strategic Radio Ltd. won one of two UK cellular telephone network licenses. The network, known as Racal Vodafone was 80% owned by Racal, with Millicom and the Hambros Technology Trust owning 15% and 5%r e s p e c t i v e l y . V o d a f o n e was launched on 1 January 1985. Racal Stra tegic Radio was renamed Racal Telecommunications Group Limited in 1985. On 29 D e c e m b e r 1 9 8 6 Racal Electronics bought out the minority shareholders of Vodafone for GB110 million. In September 1988 the company was again renamed Racal Telecom and on 26 October 1988 Racal Electronics floated 20% of the company. The flotation valued Racal Telecom a t G B 1 . 7 b i l l i o n O n 1 6 S e p t e m b e r 1 9 9 1 R a c a l T e l e c o m w a s d e m e r g e d f r o m R a c a l Electronics as Vodafone Group. In July 1996 Vodafone acquired the two thirds of Talk land it did not already own for 30.6 million. On 19 November 1996, in a defensive move, Vodafone purchased Peoples Phone for 77 million, a 181 store chain whose customers were overwhelmingly usingV o d a f o n e ' s n e t w o r k . I n a s i m i l a r m o v e t h e c o m p a n y a c q u i r e d t h e 8 0 % o f A s t e c Communications that it did not own, a service provider with 21 stores. In 1997 Vodafone introduced its Speech mark logo, as it is a quotation mark in a circle; the O's in the Vodafone logotype are opening and closing quotation marks, suggesting conversation. On 29 June 1999 Vodafone completed its purchase of Air Touch Communications Inc. and changed its name to Vodafone Air touch plc.Trading of the new company commenced on 30 th June 1999. To approve the merger, Vodafone sold its 17.2% stake in E-Plus Mobilfunk. The acquisition gave Vodafone a 35% share of Mannesmann, owner of the largest German mobile network.

Hutchison Essar (1992-2007) In 1992, Hutchison Whampoa and its Indian business partner Max Group, established a company that in 1994 was awarded a license to provide mobile telecommunications services in MUMBAI and launched commercial services as Hutchison Max in November 1995. In Delhi, Uttar Pradesh (East), Rajasthan and Haryana, Essar Group was the major partner. But later Hutch took the majority stake. By the time of Hutchison Telecom's Initial Public Offering in 2004, Hutchison Whampoa had acquired interests in six mobile telecommunications operators providing service in 13 of India's 23 license areas and following the completion of the acquisition of BPL Mobile that number increased to 16. In 2006, it announced the acquisition of a company (Essar Spacetel A subsidiary of Essar Group) that held license applications for the seven remaining license areas. Initially, the company grew its business in the largest wireless markets in India in cities like Mumbai, Delhi and Kolkata. In these densely populated urban areas it was able to establish a robust network, well known brand and large distribution network all vital to long-term success in India. Then it also targeted business users and high-end post-paid customers which helped Hutchison Essar to consistently generate a higher Average Revenue Per User (ARPU) than its competitors. By adopting this focused growth plan, it was able to establish leading positions in India's largest markets providing the resources to expand its footprint nationwide. In February 2007, Hutchison Telecom announced that it had entered into a binding agreement with a subsidiary of Vodafone Group Plc to sell its 67% direct and indirect equity and loan interests in Hutchison Essar Limited for a total cash consideration (before costs, expenses and interests) of approximately $11.1 billion. Hutch was often praised for its award winning advertisements which all follow a clean, minimalist look. A recurrent theme is that its message "Hi" stands out visibly though it uses only white letters on red background. Another successful ad campaign in 2003 featured a pug named Cheeka following a boy around in unlikely places, with the tagline, "Wherever you go, our network follows." The simple yet powerful advertisement campaigns won it many admirers. Ads featuring the pug were continued by Vodafone even after rebranding. The brand subsequently introduced Zoo Zoos which gained even higher popularity than was created by the Pug. Vodafone's creative agency is O&M while Harit Nagpal was the Marketing Director during the various phases of its brand evolution.

Timeline

1992: Hutchison Whampoa and Max Group establish Hutchison Max 2000: Acquisition of Delhi operations and entry into Calcutta (now Kolkata) and Gujarat markets through Essar acquisition 2001: Won auction for licenses to operate GSM services in Karnataka, Andhra Pradesh and Chennai 2003: Acquired AirCel Digilink (ADIL ESSAR Subsidiary) which operated in Rajasthan, Uttar Pradesh East and Haryana telecom circles and rebranded it 'Hutch'. 2004: Launched in three additional telecom circles of India namely Punjab, Uttar Pradesh (West) and West Bengal. 2005: Acquired BPL Mobile operations in 3 circles. This left BPL with operations only in Mumbai, where it still operates under the brand 'Loop Mobile'. 2007: Vodafone acquires a 67% stake in Hutchison Essar for $10.7 billion. The company is renamed Vodafone Essar. 'Hutch' is rebranded to 'Vodafone'. 2008: Vodafone acquires the licenses in remaining 7 circles and has starts its pending operations in Madhya Pradesh circle, as well as in Orissa, Assam, North East and Bihar. 2011: Vodafone Group buys out its partner Essar from its Indian mobile phone business. It paid $5.46 billion to take Essar out of its 33% stake in the Indian subsidiary. It left Vodafone owning 74% of the Indian business.

Vodafone acquires Essar's Stake On March 31, 2011, Vodafone Group Plc announced that it would buy an additional 33% stake in its Indian joint venture for $5 billion after partner Essar Group exercised an option to sell the holding in the mobile-phone operator. The deal will raise Vodafones stake to 75%. Essar will exit the company after it implemented a put option over 22% of the venture. Vodafone exercised its call option to buy an 11% stake. In 2007, Vodafone granted options to Essar that would enable the conglomerate to sell its entire stake for $5bn, or to dispose of part of the 33 per cent shareholding at an independently appraised fair market value. In January 2011, Vodafone objected to Essars plans to place part of its 33% stake in India Securities, a small public company. Vodafone feared the move would give an inflated market value to Vodafone Essar. It had approached the market regulator SEBI and also filed a petition in the Madras High Court. The final shareholding pattern post this deal was not provided by the company as it was not clear whether Vodafone's stake would exceed the 74 per cent FDI limit. Indian laws don't allow foreign companies to own more than 74% in a local mobile-phone operator. Vodafone has assured it will comply with local rules. Vodafone will have to sell that 1% to some Indian entity, or theyll have to consider an initial public offering. Vodafone also said that final settlement is anticipated to be completed by November 2011. The completion of the deal would be subject to meeting certain conditions which include Reserve Bank of Indias permission as well as valuation of the deal.

CHAPTER 2
ABOUT THE COMPANY VISION AND MISSION

MISSION Vodafone is primarily a user of technology rather than a developer of it, and this fact is reflected in the emphasis of our work program on enabling new applications of miscommunication u s i n g n e w t e c h n o l o g y f o r n e w s e r v i c e s , r e s e a r c h f o r i m p r o v i n g operational efficiency and quality of our networks and providing technology vision and leadership that can contribute directly to business decisions. VISION Our Vision is to be the worlds mobile communication leader enriching customers lives, helping individuals, businesses and Communities be more connected in a mobile world. OBJECTIVE