T-Mobile finally settles rift with Virgin

30 Jan 2004

Germany’s T-Mobile International and the UK’s Virgin Group yesterday ended their long-running dispute, paving the way for a privatisation of their UK MVNO joint venture, Virgin Mobile, later this year. Under the deal, which was settled out of court, T-Mobile’s 50% stake in the alliance will be transferred to the Virgin Group. In return Virgin has agreed to use T-Mobile as its exclusive carrier for the next ten years, and has also said it will remove a contentious clause in their contract requiring T-Mobile to pay around GBP4 a month per Virgin Mobile customer to Virgin Mobile. In addition, if and when Virgin Mobile is floated later in 2004, T-Mobile will receive 25% of any amount raised over GBP550 million, up to a maximum of GBP100 million. The analyst community have estimated Virgin Mobile’s stock market value at around GBP1 billion.

United Kingdom, T-Mobile UK, Virgin Mobile UK