France Télécom (FT) has sold a 27.3% stake in German operator mobilcom to US-based private equity fund Texas Pacific Group for EUR265 million, leaving it with just a 1% holding. FT announced two years previously that it intended to sell its mobilcom shares, in line with a strategy of group optimisation which included a general exit from the German telecoms market.
Like Germany’s other main MVNO, debitel, mobilcom was founded in 1991. It offers a portfolio of mobile voice and data services over infrastructure leased from T-Mobile, Vodafone and E-Plus. Its relationship with its French stakeholder has often been troubled; in 2000 the two created a joint venture to launch 3G services, paying USD7.6 billion for an UMTS concession. The high price caused conflicts of interest and in 2002 the pair became embroiled in a conflict over financial obligations regarding 3G rollout costs. In November that year FT and mobilcom reached an agreement on terminating their UMTS involvement and in May 2003 mobilcom transferred its UMTS sites and assets to E-plus, with the buyer paying just EUR20 million in cash and agreeing to wipe clean debts related to their 3G roaming agreement made two years earlier. Having failed to find a buyer for its UMTS licence, mobilcom returned its concession to RegTP in December 2003.
Part of the FT-led restructuring of mobilcom’s business led to the German operator transferring all of its fixed line assets to its internet services subsidiary freenet.de. mobilcom has since reduced its holding in freenet to 53% and used the proceeds to cut its debts. However, the company’s board yesterday welcomed the new US major shareholder’s intention to assist in implementing a corporate strategy which includes a plan to integrate freenet.de and mobilcom.