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Freenet Swallows Debitel in Switch to Mobile
(07 Jul 2008, BWCS Staff)German ISP and telecoms operator Freenet has bought the remaining shares in mobile service company Debitel for a reported euros 1.63 billion, a figure that include euros 1.14 billion of debt. Debitel's former owner, the private equity company Permira, now holds a quarter of the shares in Freenet. Between them, Freenet and Debitel, have around 19 million mobile customers in Germany and around 900,000 in the Netherlands.
Freenet said it will sell off its fixed line telephone and DSL unit shortly. The telco reported 1.19 million DSL customers and 2.56 million non-broadband fixed line customers on the 31st of March 2008. It says it plans to refocus on mobile phone services.
Drillisch AG. and United Internet AG, which jointly own about a quarter of Freenet's shares, fiercely opposed the acquisition and previously said they will seek to oust Freenet's supervisory board in a shareholder vote at the August 8 annual general meeting.
Late last year, Carphone Warehouse's German subsidiary, the Phone House, said it planned to pull out of the increasingly crowded German mobile service provider market. The company's decision marked what some analysts believed would be the first casualty in a highly competitive sector. The Phone House, which blamed poor margins for its decision, will not be able to fully withdraw from the German mobile service provider market until the end of April 2010.
In October 2007, Spanish-owned mobile operator O2 announced plans to launch a new low cost mobile telephone service in Germany. The move was seen as a riposte to established low-cost mobile services owned by T-Mobile and E-Plus in Germany: Congstar and Simyo.
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