Everything Everywhere, the parent company of T-Mobile and Orange has announced that it will sell off a portion of its 1800 MHz spectrum before Ofcom starts off the big 4G mobile spectrum sale later in the year. This rare auction will bring the network conglomerate in line with EU competition regulations and could raise as much as £400 million.
The merger of T-Mobile and Orange provided Everything Everywhere with by far the largest share of mobile spectrum in all of the UK. The 1800 MHz frequency of the spectrum is especially valuable as it’s perfect for mobile data transfers which are coming under increasing strain. In 2010, the mobile network was asked by the European Commission, to sell around 25% of the 1800 MHz network. Everything Everywhere has already had talks with the European Commission regarding dropping the obligation to sell two lots of 15 MHz of its spectrum but a clause in the competition regulations states that the sell-off can be re-considered if market conditions change.
Until now, Everything Everywhere, has been uncertain of when it has to sell the spectrum, although reports have stated that the operator is unwilling to sell the spectrum ahead of the 4G auction. It seems clear that Everything Everywhere want to hold off their sales for as long as possible, to gain as much financial advice as possible before selling and to gauge the impact of the 4G auction. However, the company has now announced that it is negotiating with Royal Bank of Scotland to overseeing the sale and representatives have already hinted that there might be a private sale.
Now we expect the sale to go ahead some time in February but it remains to be seen whether Everything Everywhere will prefer to lose its spectrum for a lower price if they can find a buyer that’s not a direct rival. We’ll have to wait a while to see who Everything Everywhere sell to and for how much.