The group was named the strongest telecom brand in the world in January 2022. Image Credit: Supplied

Dubai: The UAE telco e& (formerly Etisalat) said it bought a 9.8 per cent stake in Vodafone Group Plc for $4.4 billion as the Middle Eastern telecommunications provider seeks to expand globally.

e& offered about 130 pence ($1.59 dollars) a share, according to Bloomberg calculations. That's a premium of about 10 per cent to Vodafone's 117.82 pence closing price Friday.

The purchase makes e& Vodafone's largest shareholder, ahead of BlackRock, the Vanguard Group, and HSBC Holdings.

The UAE telco plans to remain a long-term investor and won't make an offer for the rest of Vodafone shares, e& said in a stock exchange statement.

e& has "made the investment in Vodafone to gain significant exposure to a world leader in connectivity and digital services" and aims to develop opportunities for commercial partnerships, it said.

"As a geographically diversified company with a deep understanding of the global telecom sector, e& sees this investment as highly efficient use of its strong balance sheet at a compelling and attractive valuation with strong currency diversification benefits.”

With this deal, the UAE telco major may also partner with Vodafone in the areas of R&D, technological applications and procurement.

Hatem Dowidar, Group CEO of e&, said: "Vodafone is one of the leading businesses at the heart of digital communications in Europe and Africa with a compelling business offering critical connectivity and digital services."

“We are looking forward to building a mutually beneficial strategic partnership with Vodafone with the goal of driving value creation for both our businesses, exploring opportunities in the rapidly developing global telecom market and supporting the adoption of next-generation technologies," he added.