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Israeli mobile operator on verge of announcing network deal with Hot Telecom, according to press report.
Golan Telecom may start providing services using Hot Mobile’s infrastructure, a move that would sidestep a tricky arrangement with Cellcom and avoid a sale of the company, an Israeli newspaper reported on Thursday.
The Israeli mobile operators "are believed to be about to announce the move shortly," Globes claimed, without disclosing where it acquired the information.
Golan Telecom, the smallest player in Israel’s mobile market, is under pressure to secure its future after regulators objected to the takeover deal it brokered with Cellcom late last year.
Cellcom agreed to pay 1.17 billion shekels (€277 million) for 100% of Golan Telecom in November, but in May the Ministry of Communications recommended the deal be blocked on competition grounds. Cellcom and Golan Telecom continued to work together to reach an agreement that would enable the smaller company to offer services over Cellcom’s network, but any such agreement would also require regulatory approval since it would effectively violate the terms of Golan Telecom’s licence.
Hot Mobile – which already has a network-sharing arrangement in place with Partner Communications, but has the right to broker infrastructure deals of its own – is a smaller entity than Cellcom and therefore would presumably be more likely to secure regulatory approval for a deal.
Indeed, Globes speculates that a network deal between Hot Telecom and Golan Telecom could lead to closer ties between the pair and ultimately a merger. It would be harder for Israel’s antitrust authority to oppose such a merger since both are small players, it said.
A network-sharing deal could put paid to ongoing takeover talk.
Russian businessman Roman Abramovich and fellow entrepreneur Oded Kobo have reportedly been in touch with the Israeli government with regard to an acquisition of Golan Telecom, information that the Ministry of Communications has passed on to the telco.
According to Globes, a tie-up with Hot Telecom could enable Golan Telecom to avoid a sale "at a rock bottom price."
