Rumours surrounding the future of Ireland’s newest and smallest cellco Meteor Mobile reached fever pitch over the weekend, after local news sources reported that Irish entrepreneur Denis O’Brien is believed to have made a bid for the operator. Meteor is currently 80% owned by Western Wireless, but the US company is believed to be looking to sell the operator ahead of the completion of its own merger with rival Alltel in June. O’Brien’s only serious competition for the cellco is expected to come from former fixed line monopoly operator eircom, but the telco is currently unsure of Western Wireless’ valuation of the company. eircom is believed to value Meteor at between EUR300 million and EUR350 million, whilst the US company puts the figure closer to EUR400 million. Whilst the value of O’Brien’s bid has not been disclosed, eircom is expected to counter his offer as it becomes increasingly desperate to secure a foothold in the country’s mobile market.
Despite the fact that it is rapidly approaching saturation levels, the Irish mobile market remains a potentially lucrative sector for investors. According to regulator ComReg, ARPU in Ireland in 2004 stood at EUR48 a month, compared to a European average of EUR31, and operators’ profit margins are far higher than elsewhere on the continent. Meteor launched Ireland’s third GSM mobile phone network in February 2001. It remains the country’s smallest network operator by some margin, but is growing steadily. In the first quarter of 2005 it signed up 37,000 new users, more than double the number added by rival O2 in the period. At the end of March Meteor had 376,600 subscribers and a market share of around 10%.