Mannesmann Narrows Gap in Vodafone Talks

Mannesmann, the target of a $164.9-billion hostile bid from Vodafone AirTouch, would accept about 52% of a combined company, narrowing the gap between what Mannesmann wants and what Vodafone is willing to offer. Mannesmann Chief Executive Klaus Esser and Vodafone CEO Chris Gent had a brief conversation over the weekend and are expected to talk again this week, people familiar with the discussions said. Mannesmann shareholders have until Monday to decide on Vodafone’s offer.

Germany’s biggest mobile phone company is under pressure to seek better terms after Vodafone announced over the weekend an alliance with Vivendi, squelching the German company’s hopes for a venture with the French utility and media business that might have swayed investors to Mannesmann’s side. Vodafone said earlier this month that it would be willing to offer Mannesmann shareholders as much as 49% of the combined company if Mannesmann’s management supports the transaction. Mannesmann has said it wants 58.5% of the new group. Vodafone’s current offer would give the German company’s shareholders 47.2% of the combined group.