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Technology Stocks : Qualcomm Moderated Thread - please read rules before posting
QCOM 174.01-0.3%Nov 14 9:30 AM EST
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To: foundation who wrote (33047)3/4/2003 5:49:13 AM
From: foundation  Read Replies (1) of 196649
 
MobilCom may sell 3G assets

By Brian Cattell, Mar 04 2003

German mobile phone operator MobilCom AG said Monday,
March 3, it is in talks with Dutch telecom Royal KPN NV and
Britain's mmO2 about selling its third-generation wireless
network.

MobilCom said it aims to conclude a deal by the end of
March. Following the slump in Germany's mobile-phone
industry, Mobilcom does not expect to recoup more than a
fraction of the 500 million ($543 million) it has invested into
building up the network.

Sources say the company may have to settle for between 50
million and 100 million. A KPN spokesman said the company
is currently examining a sales document on the network
provided by MobilCom to see whether the assets could fit in
with the 3G network that its German unit, E-Plus GmbH, is in
the process of constructing.

An mmO2 spokesman couldn't be reached for comment by
press time.

MobilCom operates Germany's smallest existing mobile
network and is also constructing its own 3G network.
Budelsdorf-based MobilCom wants to sell the network as
soon as possible to avoid having to pay maintenance costs
currently being met by its 28% shareholder France Télécom
SA.

France Télécom, which is grappling with its own 70 billion
debt pile, agreed in early 2002 to cover about 7 billion of
loans at MobilCom to allow the German company the chance
to survive as a seller of 2G services. But the French telecom
stopped funding the company in September.

Under the terms of France Télécom's rescue of MobilCom, the
German operator must pay its French shareholder 90% of the
proceeds from the sale of the 3G network. MobilCom's 3G
network, which covers about 17% of the German population,
consists of about 900 completed base stations, 900 partially
built sites and a further 1,800 sites that have already
received planning permission.

The sites with planning permission are likely to offer some
value to potential buyers given the strong local opposition to
mobile masts that exists in Germany and elsewhere in
Europe.



thefeature.com
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