Vodafone 'may move offshore'

VODAFONE chairman Lord MacLaurin has warned that the company - one of Britain's largest - might move abroad because of criticism of the way it is managed. He said chief executive Sir Christopher Gent may quit and go to the US in the face of controversy over his £10m pay package.

MacLaurin said: 'Vodafone could be based anywhere in the world and not have this hassle. But we don't want to do that. We're proud to be here and proud to be British. We don't want to run away and I would resist it. But there's no reason why we couldn't go elsewhere if we wanted to.'

Vodafone, our fourth-largest company, is valued at £61.5bn and employs 3,500 at its headquarters in Berkshire. A move abroad would be a blow to the UK economy.

The outburst by MacLaurin reveals tensions over criticism of the board for its strategy of spending billions expanding overseas while the shares have been hammered.

When it paid £113bn for Mannesmann of Germany in 2000, the shares hit a peak of 400p. Since then they have largely fallen, closing up 1 3/4p at 92p on Monday.

Vodafone believes global scale will help it obtain better deals from suppliers and is banking on 3G services, such as fast internet from mobile phones, to deliver rapid growth. The group has cut costs, but 3G has been delayed, and many doubt the technology will live up to initial hopes.

Vodafone's possible £8bn purchase of French telecoms group Cegetel has reinforced fears that management may be blinded by their enthusiasm for mobile technology.

Lord MacLaurin takes particular issue with how the media reported the group's £13.5bn annual loss - the largest in UK corporate history He says Vodafone was caught on the wrong side of an accounting change that forced it to write off £13.5bn of goodwill - the difference between the value of assets acquired and the price it paid. He believes investors should ignore the charge because it does not affect the group's cash position.