Vodafone takes €1bn hit from Drahi deal

By the Editorial Team · Thursday, September 17, 2026

Vodafone faces a potential loss of over €1 billion in future earnings after Patrick Drahi sold his 50 percent stake in the German broadband joint venture OXG to Société Générale, which does not assume previous deferred payment obligations. This change, combined with regulatory rulings requiring Vodafone to repay broadband customers, exacerbates financial pressures as the company navigates operational setbacks and strategic shifts in its German market presence.

Vodafone faces a potential loss exceeding €1 billion in future earnings following the sale of Patrick Drahi’s stake in their German broadband joint venture, OXG. The French-Israeli billionaire’s decision to sell his 50 percent holding to Société Générale has relieved him of previously agreed financial commitments tied to the venture.

Under the original arrangement, Vodafone was entitled to receive deferred payments of approximately €487 million from Drahi’s Geodesia Holding, along with a potential earnout payment close to €595 million, contingent on OXG meeting certain performance milestones. However, Société Générale’s acquisition of Drahi’s stake does not include these deferred payment obligations, according to people familiar with the terms. Vodafone has not publicly disclosed the change to investors.

In response, Vodafone stated that replacing Drahi with Société Générale offered "the best option between rollout funding certainty and strategic flexibility," emphasizing support for Altice’s exit and welcoming Société Générale as a committed investor.

The OXG joint venture, launched in 2023 by Vodafone and Drahi’s telecom unit Altice, committed to investing €7 billion to extend fibre broadband access to over 7 million German homes within six years. Yet, operational challenges, particularly higher than expected build costs, have limited progress, with the network currently reaching around 1 million homes as of September 2026. The first deferred payment from Drahi was scheduled only after OXG passed 1.5 million homes, a milestone not yet reached; Vodafone expected these payments to begin no earlier than fiscal year 2028.

Industry analysts have critiqued Vodafone’s partnership with Drahi. James Ratzer of New Street Research described Drahi as a problematic partner, noting that despite Drahi’s renewed guarantees last year and his recent €20.35 billion sale of French telecoms unit SFR—transactions intended to alleviate his company’s debt—Vodafone moved away from anticipated proceeds under the original deal.

Drahi’s stake in OXG had drawn significant scrutiny from creditors, particularly after he transferred his holding, along with other assets, beyond the reach of lenders owed approximately €8 billion. Altice declined to comment on the matter.

Meanwhile, Vodafone’s financial position in Germany faces further challenges. The telecoms group must now repay additional income derived from a €5 monthly price increase imposed on broadband customers in 2023. This follows a recent ruling by the European Court of Justice, which concluded that EU law does not grant providers an automatic right to unilaterally alter their general terms and conditions. Industry estimates suggest Vodafone could face between €100 million and €200 million in repayments due to the ruling.

Separately, French telecom billionaire Xavier Niel has increased his stake in Vodafone, becoming the company’s largest shareholder with a 19 percent holding as of September 2026, up from 16 percent in July.

This article was reported by synthesizing coverage from multiple independent news outlets to present a balanced, unbiased account. Read about our editorial standards. Spotted an error? Let us know.