Vodafone: Racal's Military Radios, the Mannesmann Takeover and M-Pesa

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Vodafone grew out of Racal Electronics, the UK's largest maker of military radios in 1980. Racal had battlefield radio technology from America's General Electric, and chairman Ernest Harrison asked his head of military radio, Gerry Whent, to find a civilian use for it. Teaming with Millicom in 1982, Racal won the UK's second cellular license on a pitch of fast nationwide coverage, and the network launched on New Year's Day 1985 under a name built from voice, data and phone, with comedian Ernie Wise making the first official call. After Racal floated 20 percent of the unit in 1988, the telecom business was soon valued above its parent, and a 1991 demerger created the standalone Vodafone Group.

Under CEO Chris Gent, Vodafone bought America's AirTouch in 1999 and in 2000 won Germany's Mannesmann in a 112 billion pound hostile takeover, though regulators made it divest Orange. It took 45 percent of Verizon Wireless and from 2001 licensed its brand to local operators through partner networks. Controversies followed: a 2010 investigation found it had routed the Mannesmann deal through Luxembourg, with an estimated tax bill over 6 billion pounds settled for 1.25 billion, and it complied with Egypt's order to shut down networks during the 2011 protests. From 2013 it shrank, selling its Verizon Wireless stake for $130 billion, exiting New Zealand, Ghana, Hungary, Spain and Italy, and spinning off 68,000 European towers as Vantage Towers in 2020. In May 2026 it paid 4.3 billion pounds for full control of its merger with Three UK, approved after it committed to 11 billion pounds of 5G investment and price caps.

• Through Kenyan affiliate Safaricom, M-Pesa let users deposit cash with local agents and send money by text message, bypassing banks.
• SMS for Life in Tanzania used text tracking of malaria drug supplies to cut clinic stockouts from 26 percent to 0.8 percent.
• About 19 billion pounds from the Verizon sale funded Project Spring to upgrade European networks.
• The Italian business went to Swisscom in early 2025.
• In 2026, 62 former UK franchisees filed an 85 million pound High Court claim over sales pressure, which Vodafone settled without admitting liability.