News
A flurry of M&A swept across the industry this week as EU decision day finally arrived in the U.K.
The ballots have been counted and after months of intense and often acrimonious campaigning, a narrow majority of people in the U.K. have decided to leave the European Union.
No one can say with any certainty what long-term effects this result will have on the telecoms industry both in the U.K. and abroad. One thing we telco hacks are often told though, is that this industry requires collaboration on a global scale in order to flourish. So when one of the world’s largest economies says ‘thanks but no thanks’ to close ties with its European partners, it feels somewhat counterintuitive.
There is also no getting away from the fact that telecoms is capital-intensive, and investments feeds on certainty. Now that 52% of the U.K. electorate has caused a wave of uncertainty to sweep global markets, it would not come as a huge surprise if some investments are put on hold until the dust settles, or if some companies that chose the U.K. as their route to the EU look to other pastures.
That is the reality facing the U.K. and the world this morning, and while opting to leave the EU was certainly the most high-profile exit this week, it was not the only one.
Tuesday saw Sweden’s Telia Company finally find a way out of Spain, when it agreed to sell its 76.6% stake in Yoigo to Masmovil, which is busy building up its fixed and mobile assets so that it can compete with the country’s big guns, Telefonica, Vodafone and Orange.
Telia tried unsuccessfully to sell Yoigo in 2012, abandoning the process in April 2013 on the grounds that the offers did not take into consideration Yoigo’s growth potential.
At the time, sources claimed that bids for the company valued it at around €1 billion. Tuesday’s Masmovil deal values Yoigo at around €612 million. Make of that what you will.
Telia’s departure from Spain is in line with its plan to focus on the Nordics and Baltics, and with that in mind, it made an unsolicited €130 million bid for Finland’s Anvia Telecom. However, Anvia has already agreed a €107 million sale to major shareholder Elisa, so Telia has its work cut out there.
Also on Tuesday, Danish incumbent TDC decided to wave goodbye to its Swedish B2B arm TDC Sweden, which it has agreed to sell to Tele2 for €311 million.
Further afield, and Bharti Airtel bid farewell to Burkina Faso this week, completing the sale of its local Airtel unit to Orange.
While the curtain came down on a 43-year era in Europe, across the pond another 43-year era also ended.
The Dolan family, which founded U.S. cableco Cablevision in 1973, the same year that the U.K. joined the European Community, on Wednesday completed the $17.7 billion sale of its stake in the family business to Altice.
Altice has put chief executive Dexter Goei in charge of its U.S. arm and promoted chief operating officer Michel Combes to the CEO role.
Speaking of CEOs, it was confirmed by HTC this week that co-founder and former chief executive Peter Chou has left the troubled Taiwanese smartphone maker.
Those who voted remain in Thursday’s referendum might feel like hiding underground for a while, in which case, Telstra has you covered: the Australian incumbent this week acquired assets from CBO Telecommunications – which specialises in building networks in harsh environments – and established a new division called Telstra Mining Services.
Hmm, moving to Australia. Now there’s a thought…
