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Vodafone making an offer for Liberty Global assets, Elliott taking control of TIM and BT reorganising were the main developments in the European telecoms sector, last week, according Telecompaper. It left our index in the red for the week (-0.5%), against a small gain for the EuroStoxx 50 index (+0.4%).
 
Vodafone/Liberty no done deal
 
Having its talks with Liberty Global (-6.7%) no secret, Vodafone (-0.2%) finally managed to provide the market with a takeover offer for a large chunk of Liberty Global. It appears to be no done deal from a German perspective. The parties themselves shrugged off any worries over regulators possibly blocking the deal by pointing out that their respective cable assets in Germany don't overlap. They appear convinced that it will be approved by mid 2019.
 
At the same time, both Liberty Global and Deutsche Telekom (-1.6), vehemently opposing any Vodafone/Liberty deal, reported on their Q1 earnings. More Q1 results came out of United Unternet (+2.2%), 1&1 Drillisch (+1.5%), Cyfrowy Polsat (+1.6%) and German business provider QSC (-2.2%).
 
Control of TIM and TDC
 
The fight for control over TIM (Telecom Italia, -5.9%) ended with Elliott Advisors winning the shareholder vote, allowing it to name 10 out of 15 representatives on the board. Meanwhile in Denmark, the Macquarie consortium completed the takeover of TDC (+0.2%). S&P was quick to lower TDC's rating. At Telenet (unchanged), a minority shareholder called on Liberty Global to buy out the minority shareholders.
 
BT reorganises
 
BT was under fire over not just its quarterly results, but a major reorganisation, a deal to cover the pension fund deficit and a legal settlement.
 
The plot thickened for Sky (-1.1%). After having given support to Comcast's rival offer to Fox's earlier bid, Comcast apparently plans to take over Fox as well. It wants to trump Disney's earlier all-stock offer with an all-cash offer of possibly USD 60 billion. However, it remains to be seen who will win the battle for the premium content of both 21st Century Fox and Sky.
 
Year-to-date: Intelsat quadruples
 
In the year-to-date view our index is down 3.4 percent, versus a gain of 1.8 percent for the EuroStoxx 50 index. VEON (-27%), Ecotel (-26%) and Inmarsat (-21%) are the worst performers, but have limited impact due to their small sizes. BT (-20%) and Liberty Global (-17%) put the largest drag on the sector.
 
Intelsat (+313%) is the biggest winner. Its share price rose 17 percent in week 19 and has now quadrupled year-to-date on the perceived value of its US spectrum holdings in relation to 5G. CityFibre (+35%), Sky (+34%), TDC (+32%) and Com Hem (+22%) have takeover offers to thank for their solid outperformance YTD. MasMovil (+34%) among the small caps and TIM (+12%) among the mid caps are also doing very well. The best performing large caps so far are Orange (+4.9%) and Telefonica (+2.7%).