Polish auction draws three bids

date: 04 December 2000, source: FT.com

Eastern Europe's first tender for third-generation mobile phone licences suffered another blow when just three companies entered bids for five Polish 3G concessions.

PTK Centertel, Polkomtel and Polska Telefonia Cyfrowa, Poland's three second-generation operators, were alone in bidding after Spain's Telefonica Moviles, the only big potential foreign operator, dropped out just before the deadline.

The government, which is short of revenues, vowed to proceed with the tender, which it must complete this year or postpone until 2002. However, it will only receive three-fifths of the revenues it had expected - it is asking E650m ($559m) per licence.

Miroslaw Marcinkiewicz, head of the tender committee, said: "If the three offers we received today are complete, we can consider the tender valid."

Tomasz Szyszko, communications minister, said a week ago that six or seven consortia were expected to bid.

"This is a clear vote of no confidence in the communications ministry," said Grzegorz Cimochowski, a Warsaw investment adviser. "If no external operator saw fit to bid, there's definitely something wrong."

Since its launch in October, the sale has been plagued by rule changes.

The operators, who claim some of the tender's terms and subsequent changes are illegal, threatened a boycott on Friday after the ministry said it might sell four rather than five concessions. But PTK Centertel - owned by France Telecom and Poland's Telekomunikacja Polska - entered a bid just an hour ahead of Saturday's deadline.

PTC - owned by Deutsche Telekom, Vivendi and Poland's Elektrim - and Polkomtel, whose shareholders include Vodafone and TeleDanmark, followed suit.

Their bids may not end the uncertainty. Representatives of Polkomtel and PTC did not rule out the possibility of future legal challenges to the tender, which could result in its annulment.

The regulatory questions and deteriorating telecoms market conditions, may have influenced Telefonica's decision not to bid. But a Telefonica spokesman did not confirm the view, noting the company "does not seek to be present in all European markets", and that it might bid in Poland if a second round was called.

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