Vodafone Airtouch finally sealed its hard fought merger with German mobile operator Mannesmann late on Thursday.

The UK based operator secured the deal after sweetening its offer to $176 billion (180 billion euros). Mannesmann shareholders will now get a 49.5 per cent share in the combined company, up from the 47.2 per cent originally offered.

Vodafone originally mounted a hostile takeover bid for the German company last November targeting it as a key plank in its global expansion strategy. But Mannesmann resisted, arguing that the original offer was not enough as it would provide more than half of the new growth from the combined businesses.

Chris Gent, Vodafone Airtouch's chief executive, said: "We are delighted that the management board has agreed our revised offer to Mannesmann shareholders. We are confident that the combination of our two multimedia communications companies will enable us to create one of the world's leading mobile multimedia communications companies."

Mannesmann officials said in a statement: "On the basis of the agreement, the Mannesmann group can look forward to continued commercial success while its management and employees can expect further prospect for successful development."

The German operator has also secured other key issues as part of the deal, including its continued participation in the Arcor and Infostrada wireline businesses and the flotation of its engineering and automotive units in the middle of the year.

The fate of Orange, Vodafone's UK rival, which Mannesmann acquired in October for £19.8 billion, was not immediately clear.

Mannesmann will have five representatives out of a total of 19 on the new Vodafone Airtouch board. Klaus Esser, its chief executive, will also join the board, but will resume a non executive role once Mannesmann sells off its industrial businesses.

Mannesmann is a majority shareholder in two of Europe's top three European mobile operators, Omnitel in Italy, and Mannesman D2 in Germany. They have a combined subscriber base of eight million.

It likewise holds a 15 per cent stake in SFR, the French mobile operator and has recently gained a fourth mobile license for Austria.

More Vodafone-Mannesmann coverage:

Mobile deal means more services, but no price cuts

Orange future unclear after Vodafone deal

See also:

Vodafone takeover row heads to court

Prosecutors close to pressing charges  25 Jul 2002

Vodafone's Gent off the hook

German regualtors say that he has no case to answer over £52m 'sweetener'.  10 Sep 2001

Orange bought by France Telecom

France Telecom has agreed to acquire UK mobile operator Orange from Vodafone Airtouch for £25.1bn and plans to combine the company with its existing mobile operations.  30 May 2000

Special Coverage: Vodafone clinches Mannesmann

Vodafone Airtouch finally won its hard fought battle to buy German mobile operator Mannesmann last month.In a special report, vnunet.com brought you all the news and reactions from across the telecoms industry to the mammoth mobile deal.  07 Feb 2000

Mannesmann savaged by High Court as Vodaphone sweetens the pill

Mannesmann suffered a humiliating setback yesterday when the High Court in London described its conduct as "totally disgraceful and unacceptable."  19 Nov 1999

Mannesmann alleges information misuse by Goldman Sachs in Vodafone's £65 billion bid

The fallout from Vodaphone's hostile bid for Mannesmann is spreading rapidly, with the German telecomms giant accusing its bankers, Goldman Sachs, of misuse of confidential information.  16 Nov 1999

Mannesmann spurns Vodaphone AirTouch

Vodafone AirTouch looks set to proceed with a hostile takeover of Mannesmann after the German telecommunications, engineering and steel giant rejected a massive £65 billion bid at the weekend.  15 Nov 1999

Orange accepts Mannesmann takeover offer

Britain's number three mobile operator Orange is set to fall to German mobile and engineering giant Mannesmann after accepting a GBP19.8 billion takeover bid.  21 Oct 1999

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