KPN, NTT DoCoMo to Buy 35% of Hutchison U.K.
Unit, People Say
By Adri den Broeder
London, July 11 (Bloomberg) -- NTT DoCoMo Inc. and Royal KPN NV agreed
to buy a 35 percent stake in a unit of Hutchison Whampoa Ltd. that owns a
$6.7 billion license to provide faster mobile services in the U.K., people familiar
with the negotiations said.
DoCoMo will pay 1.9 billion euros ($1.8 billion) for a 20 percent stake, and
KPN will pay 1.4 billion euros for 15 percent, according to one of the people.
The agreement will be announced tomorrow, the people said. The companies
declined to comment.
KPN, the biggest Dutch phone company, said a week ago it's in talks with
DoCoMo, Japan's No. 1 wireless company, and Hutchison, Hong Kong's
largest conglomerate, to cooperate on new mobile-phone services in Europe.
The companies are likely to join forces to get licenses in Germany, France
and Belgium, investors said.
Telecommunications companies are trying to share the cost of new mobile
phone licenses, networks and international expansion. Hutchison bought the
U.K. license in April with Canada's Telesystem International Wireless Inc.
The investment would give DoCoMo and KPN access to the U.K. cellular
market, one of the first in Europe to offer Universal Mobile
Telecommunications System technology that will let users surf the Web and
see video on their phones at speeds 40 times faster than today.
Bidding Alone
The three companies are connected through DoCoMo. The Japanese
company, which already offers some Internet services through mobile phones,
agreed in May to buy a 15 percent stake in KPN Mobile, a unit of KPN, for
$4.5 billion. DoCoMo also owns 19 percent of Hutchison's Hong Kong mobile
phone company, Hutchison Telephone.
In Germany, Europe's largest economy, KPN yesterday applied to bid for a
new mobile license with a group, rather than through its E-Plus Mobilfunk
GmbH unit. KPN declined to give details. Hutchison plans to bid in the
auction, which starts July 31.
France is another market KPN is targeting, the Dutch company said when it
announced DoCoMo's investment. France is selling five permits for a total $19
billion.
KPN is bidding alone in the Netherlands, where it's the biggest mobile phone
company, against five other companies for five licenses. Hutchison dropped
out of the auction just hours before it began Thursday.
In Belgium, KPN is expected to buy out its joint venture partner Orange Plc to
take control of the country's third-largest cellular phone company. France
Telecom SA, which is acquiring Orange for $40 billion, already has a stake in
Mobistar SA, Belgium's No. 2 mobile phone network. |
