A £6BN BID for Ono by Vodafone has been tarnished by allegations the Spanish cable operator’s price may have been inflated by tax fraud.
The British telecommunications network has blocked the payout of £50m in bonuses to the former Ono chairman, chief executive and CFO as the alleged fraud is investigated by the Spanish authorities, The Telegraph reports.
Jose Maria Castellano, Rosalia Portela and Carlos Sagasta are no longer involved with the company. Portela had been due to stay on for a year to assist in the integration of Ono but left suddenly last month.
The allegations centre around the company’s movements in the wholesale telecoms market. A small group of staff traded international call minutes off its balance sheet through affiliate companies – allegedly without paying VAT – and Ono profited.
It is thought the tax authorities already knew of the irregularities and a probe had been underway for a full nine months prior to Vodafone’s agreement to acquire Ono in March.
An inquiry on Vodafone’s behalf is being conducted by Deloitte and city law firm DLA Piper, focusing on what Castellano, Portela and Sagasta knew, and when.
A Vodafone spokesman told The Telegraph: “As soon as Vodafone became aware of the issue we instigated a forensic audit to investigate the facts relating to the alleged fraud.
“As this matter remains under investigation, we cannot comment further.”