STOCKWATCH Vodafone slumps on 3 bln rights issue to fund snatch of BT assets

LONDON (AFX) - Shares in Vodafone Group PLC slumped in opening trades after the group announced it is placing shares worth about 3 bln stg to fund the bulk of its cash buy, for a total of 4.8 bln, of British Telecommunications PLC's stakes in operators in Spain and Japan, dealers said.	    At 8.17 am, Vodafone shares were down 10-1/2 or 5.21 pct at 195-1/2, off a low of 193-1/2, on a volume of 84.81 mln shares traded.	    The placing of around 1.5 bln shares, by Vodafone's usual brokers Goldman Sachs and UBS Warburg, is one of the largest ever seen in the London market and is already weighing heavily both on Vodafone's price and on the wider market, dealers said.	    The deal means that Vodafone will have a stake of 45 pct in Japan Telecom, Japan's second largest telecoms operator, as well as an effective 46 pct stake in mobile operator J-Phone, although the economic stake thanks to Japan Telecom's holding in J-Phone will amount to about 60 pct.	    In addition, Vodafone will gain a further 17.8 pct of Spanish mobile carrier Airtel Moviles from BT, giving it a 91.6 pct stake with the two remaining shareholders -- neither of which are telecoms operators -- having put options to sell up to Vodafone should they see fit.	    The placing is bad news for BT on two counts, dealers said. The group has long stressed the importance of its position in Japan, and the ties to the country have traditionally been driven by its chief executive, Sir Peter Bonfield.	    The move out of Japan, while pleasing investors who urgently demand rapid movement on the group's 30 bln stg debt burden, casts a further shadow over Bonfield's future in the wake of the departure from the chairmanship of the other investors' bugbear, Sir Iain Vallance, and the arrival yesterday of BBC chairman Sir Christopher Bland.	    More importantly, though, the success of BT's own widely predicted rights issue must be in doubt after Vodafone has soaked up so much of the available money for telecoms, dealers said. BT is widely believed to be looking for upwards of 5 bln stg from a rights issue, although the wilder reports of 10 bln may now be in the shade thanks to the net 4.4 bln stg BT is making from today's sale.  

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