VimpelCom confident that licence fees will not derail Italian deal

4 Nov 2016

The chief executive of Amsterdam-based telecoms group VimpelCom says that the Italian government’s proposals to renew wireless spectrum licences will not jeopardise the planned merger of its local unit Wind Telecomunicazioni with CK Hutchison’s subsidiary 3 Italia. Jean-Yves Charlier is quoted by Reuters as saying that even if operators agreed to the renewal, it was unlikely to have an impact on the merger or its cost structure.

Italy is expecting to raise EUR1.8 billion (USD2 billion) when it renews 900MHz and 1800MHz licences due to expire in 2018. The French telco Iliad has agreed to acquire tower and spectrum assets – including 900MHz and 1800MHz frequencies – from Wind and 3 to allow it to set up as a new mobile network operator (MNO) in Italy, thereby retaining the four-player make-up of the country’s cellular market. This agreement helped the merger gain clearance from European Commission (EC) competition authorities.

There had been some speculation, however, that Iliad was unhappy with having to pay to renew the concessions so soon after acquiring them from Wind/3 for EUR450 million. It is thought that Iliad will be expected to pay around EUR300 million to extend its licences to end-2029, while TIM and Vodafone will pay around EUR550 million each and the combined Wind/3 will pay around EUR350 million.

Italy, 3 Italia (H3G Italia), Iliad Italia, VEON, WINDTRE (incl. Wind and 3 Italia)