French entrepreneur Xavier Niel plans to invest approximately $5.9 billion to acquire a 16.2% stake in Vodafone Group PLC from the Emirati telecommunications group e&.

The deal, which makes the French billionaire the single largest shareholder in the British telecom giant, triggered a sharp rise in Vodafone Group PLC (LON: VOD) shares on Friday, with the stock surging as much as 14% in early London trading.

Niel's acquisition vehicle, Atlas Investissement, is paying around £4.4 billion ($5.9 billion) in cash for the entire stake held by e&. The offer price of 110.5 pence per share represents a 13% premium to Vodafone's closing price on Thursday. Additionally, e& will receive Vodafone's final dividend of approximately 2 pence per share, bringing the total effective price per share to 112.5 pence.

Niel, a former programmer turned telecom magnate, is the founder of French mobile and internet provider Iliad and also holds a stake in the French newspaper Le Monde. His telecom interests span France, Italy, Poland, Switzerland, Cyprus, and Ukraine, and he holds stakes in Nordic telecom companies Millicom and Tele2. He recently acquired a majority stake in Telefónica's Chilean unit. His family's telecom assets generate annual revenues of about €24 billion ($27.43 billion).

On Friday, Niel stated that Vodafone possesses high-quality assets, a strong brand, a leading market position, and a diversified global footprint, making it an attractive investment opportunity.

He said in a statement, "Vodafone is entering a new growth cycle, with significant untapped potential in its European and African operations. The company is well-positioned to unlock this value."

Emirati telecom group e& stated that the sale is part of a strategy to streamline its portfolio, focus on its core business, and realize gains from this investment. The shares will be transferred to three financial institutions to hold in escrow until Atlas completes all necessary regulatory approvals.

The transaction also triggers a board change: the representative appointed by e& to Vodafone's board has stepped down with immediate effect. Hatem Dowidar joined the board in 2023 following e&'s strategic investment in Vodafone.

Dan Coatsworth, investment director at AJ Bell, commented that if the deal is approved, it will introduce another shift in the ownership landscape of UK telecom companies. Previously, another French billionaire, Patrick Drahi, held a 24.5% stake in BT Group, which he sold to Bharti Global in 2024 to repay debt.

"The market has reacted positively to Niel's acquisition, with many investors speculating that a full takeover of Vodafone could be his ultimate goal," said Coatsworth. "Even if that doesn't materialize, such speculation is unlikely to fade away."