Margherita Della Valle has been appointed as the Chief Executive Officer of Vodafone Group Plc, ending the uncertainty that has been rife for five months since Nick Read was ousted from his position in December by the challenged British telecommunications giant.
Vodafone has been running its finance department on an interim basis since Jan. 1, under Della Valle, who has been serving as the company's chief financial officer since 2018. As the Newbury, England-based company announced in a press release on Thursday, she will continue to serve as the company's CFO until an external search for a replacement is concluded.
During the company's search for its next leader, Jean-Francois van Boxmeer announced that he had conducted "a rigorous search both internally and externally," but that Della Valle had won over the board of directors with the "speed and decisiveness with which she had begun the necessary transformation of Vodafone.”
The appointment of Della Valle coincides with a moment of turmoil for the telecommunications industry as a whole. It is undeniable that data usage has skyrocketed and that companies have invested in fiber and 5G networks in recent years, but data charges have not risen in tandem.
In less than a week after becoming interim CEO on January 1, Della reshuffled the company's executive committee, appointing a Chief Commercial Officer to lead the company's commercial division and demoting Vodafone Spain to the second tier of smaller markets in the 'Europe Cluster'. There has also been a push by the company to cut jobs in its London corporate headquarters as well.
With Della Valle's leadership, Vodafone slashed costs by billions of euros and also carved out, listed, and sold Vodafone's mobile mast business Vantage Towers AG during her time as the company's CFO.
The fact remains, however, that she faces a lot of challenges in the future. As Vodafone's shares are near two-decade lows, it is facing stagnant or even shrinking sales in key markets, including Germany, which it entered four years ago, one of its biggest markets. According to Sir Philip Read, the previous CEO of Vodafone, consolidation deals were one of the ways for the company to increase its finances. However, Vodafone has not yet finalized a merger agreement with CK Hutchison Holdings Ltd's Three UK in the UK, and last year it rejected an offer in Italy because it was too low.
In light of Vodafone's weak share price and rivals taking stakes in the company, there had been speculation that the company might appoint an external leader. However, by appointing Della Valle, Vodafone continues an unbroken tradition of selecting candidates with internal experience for the top position. He was also the CFO of a company prior to joining Read.
In London on Thursday, Vodafone's share price rose 0.9% to 95.15 pence, up from 95.13 pence a day earlier.
It is expected that Della Valle will be able to share more of the details of her company's strategy at the full-year results event on May 16. In fact, she is now one of just a few female executives on the FTSE 100 Index, which measures the performance of the largest companies in the country.
"I am very pleased with the choice of Margherita - one of the brightest, most determined, and most experienced individuals in the sector globally," said former Vodafone CEO Vittorio Colao by phone in a statement. Della Valle has known Colao for over 30 years and worked with her at Vodafone Italy when it was still known as Omnitel back when it was a startup.
"There is a sense of calm and control about her engagement style, and she has clear objectives for what she is doing. Considering all the issues Vodafone has at the moment, I'm confident that she will be able to tackle them immediately. It is obvious that you are speaking to a complete fan and a complete supporter. There might be a tiny bit of bias on my part," he said.
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