The shares of the British investment firm Zegona, owner of Vodafone Spain, have concluded this Thursday's session on the London Stock Exchange with a decline of over 3%, after announcing that it will distribute 400 million euros among its shareholders through dividends and a share buyback plan, according to a statement.
Specifically, the fund has dropped 3.39% on the London floor, leaving the price of each share at 17.1 British pounds, equivalent to 19.9 euros.
Before the market opened, Zegona announced its new capital allocation framework and detailed a total remuneration of 400 million euros for shareholders, which breaks down into an ordinary dividend of 200 million euros and a new share buyback program for another 200 million euros.
The company explained that this scheme defines a "clear and lasting" structure for investment in the business, balance sheet management, and shareholder return policy.
The fund emphasized that the measure responds to the completion of the first phase of the transformation of Vodafone Spain, to the reduction of leverage and the cost of debt since the acquisition, as well as to the board's confidence in the growth of free cash flow "from this moment on."
Regarding the first remuneration under this new framework, the board expects to approve an ordinary dividend of 200 million euros corresponding to the fiscal year ending next March 31, financed with free cash flow, subject to the approval of shareholders at the annual general meeting and paid as a final dividend.
At the same time, the entity has launched a new share buyback program for an amount of 200 million euros, also funded with free cash flow.
This new plan, according to the fund, adds to the share buyback program of 200 million euros announced on November 27, 2025, and initiated on December 12, 2025, which is already considered concluded.
Share acquisitions in the market will be carried out in accordance with the agreement signed with Canaccord Genuity Limited on September 23, 2026, and all repurchased shares will subsequently be canceled.
The board of directors considers that repurchasing shares at current prices represents an "attractive" use of capital, understanding that the company's shares continue to trade at a "substantial discount" compared to their intrinsic value and that of their European telecommunications sector peers.
Investment in Vodafone Spain and financial objectives
The operator has reiterated that the investment in Vodafone Spain to support future revenue and cash flow growth remains its "top priority."
The firm will maintain its focus on customers, product innovation, network quality, and operational efficiency.
According to analyst consensus, Zegona plans to allocate between 2.000 and 3.000 million euros to investments in Vodafone Spain over the next 3 to 4 years. This volume of resources will allow for continued reinforcement of the network, driving innovation, improving customer experience, and increasing business competitiveness, also reflecting Zegona's long-term commitment to Vodafone Spain and the Spanish market.
Furthermore, Zegona has highlighted that the closure of the joint ventures PremiumFiber and FiberPass has fundamentally transformed the economics of Vodafone Spain's fixed broadband business, resulting in a "simpler and more cash-generative" activity.
As a consequence, it expects that Vodafone Spain can finance its growth plan from its annual cash flow.
Regarding its financial position, the company aims to maintain a sustainable long-term debt level, with a target of between 2.25 and 2.75 times its earnings before interest, taxes, depreciation, and amortization after leases (EBITDAaL).
After distributions to shareholders, the indebtedness will be at the lower end of that range. The company has significantly reduced its debt: from 3.1 times EBITDAaL when it acquired Vodafone Spain in May 2024 to 2.3 times as of June 30, 2026.
Additionally, in June 2026, Zegona refinanced all of its senior secured notes and senior credit lines, extending the maturity of its capital structure beyond five years and reducing the annual recurring debt cost to about 170 million euros, compared to 294 million euros two years ago.
"An important step" in Zegona's evolution
Looking at the medium and long term, the board will maintain "full flexibility" regarding the form, combination, and timing of future capital returns beyond the progressive ordinary dividend, actively assessing new share buybacks and possible extraordinary dividends with the aim of returning "all free cash flow to shareholders over time".
The president and CEO of Zegona, Eamonn O'Hare, has pointed out that the announcement represents an "important" step in the evolution of the company.
"Since the acquisition of Vodafone Spain two years ago, we have built a stronger, simpler business with greater cash generation capacity, and we are now in a position to establish a clear and disciplined framework for capital allocation," he emphasized.
O'Hare added that his goal is to return all free cash flow to shareholders in the "fastest and most efficient" way possible to maximize long-term value and stressed that, taking as a reference the 1.6 billion euros of remuneration executed at the beginning of the year, "the announcement returns approximately an additional 10% of Zegona's market capitalization".