Vodafone Spain ordered to give up spectrum in wake of ONO acquisition

16 Jan 2015

Following the acquisition of Spanish cableco ONO by British telecoms giant Vodafone Group last year, the latter’s Spanish subsidiary Vodafone Spain has been told it must give up frequencies it acquired as part of that deal, as it had breached a spectrum cap for the band in question.

As previously reported by CommsUpdate, back in July 2011 ONO, Spain’s largest cable operator by subscribers, spent EUR13.30 million (USD19.2 million) on 20MHz in the 2600MHz band in nine regions of the country, those being: Cantabria, Catalonia, Valencia, Madrid, Murcia, Navarra, La Rioja, Ceuta and Melilla. At the same time, Vodafone Spain itself acquired a total of 40MHz in that same band at a cost of just over EUR59 million.

According to Expansion, Vodafone had two options for relinquishing these frequencies, those being to either strike a deal to sell them to another company, or instead hand them back to the state. While it is understood that negotiations regarding a possible sale had been carried out with alternative operator Jazztel, such plans were effectively blocked by the announcement that Orange Espana had made a EUR3.4 billion offer for that company in September 2014. With it appearing unlikely a deal could be struck to sell off the spectrum to any other company, it has been claimed that Vodafone will now have to return it to the state.

However, rather than simply hand it back, Vodafone is said to be keen to get some return, though an initial inquiry into how much it would cost it to retain the frequencies was said to have been knocked back by authorities. As such, it has been claimed that Vodafone could instead pursue legal avenues, firstly to overturn the decision requiring it to unload the frequencies, while it has also been suggested it may launch proceedings with a view to reclaiming the money ONO had originally spent on the spectrum.