Telefonica Commits Itself to Italian 3G

date: February 26, 2002 - source: BWCS

Italian 3G licensee Ipse has received funding to see it through another twelve months of operations, with majority shareholder Telefonica of Spain providing euro250 million to keep it afloat. Telefonica, which owns 45.6% of Ipse, is providing euro150 million for the 2001 budget and euro100 million for 2002. The Italian telecommunications minister, Maurizio Gasparri, welcomed the news, adding that Ipse’s remaining shareholders should follow Telefonica’s example and invest to guarantee the company’s future.

There had been some speculation that Ipse’s shareholders were considering mothballing the company until such time that cash could be found to fund its 3G network rollout, but the Italian government threatened to revoke the licence of any operator which does not meet its 3G rollout commitments. Ipse is one of five 3G licensees in Italy and one of two which does not have existing mobile operations there. The remaining UMTS concession holders are Telecom Italia Mobile (TIM), Omnitel Vodafone, Wind and the other new entrant H3G.

Meanwhile, TIM has revealed that it is to offload its stake in French GSM operator Bouygues Telecom, one of the companies tipped to pick up one of France’s two remaining 3G licences later this year. TIM is selling its 10.8% stake back to the French telco’s parent company Bouygues in a deal which is thought to be worth around euro750 million. TIM recently agreed a euro1.85 billion sale of its stake in Spanish telecoms group Auna, which controls Spain’s third largest GSM operator Amena and has also been awarded a concession to offer 3G services in Spain. Telecom Italia is selling off non-core investments in order to reduce some of its euro18.5 billion debt burden.

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