Last month the country’s competition authority barred Vodafone from acquiring Nowo after a protracted investigation into the effects on competition
Romania’s Digi Communications is looking to expand operations in Portugal with the acquisition of that country’s fourth largest operator, Nowo Communications for €150 million.
Digi will acquire Cabonitel, owner of Nowo. The latter has 270,000 mobile customers and 130,000 customers for its pay-TV and broadband services. Nowo has spectrum licences in the 1800MHz, 2.6GHz and 3.6GHz bands.
Digi must gain regulatory approvals to acquire Nowo but its chances seem better as it is already investing in its own fibre access network infrastructure in Portugal and it is strengthening the fourth operator which the competition authority saw as essential in the market.
Digi also has plans to launch in the moribund Belgian market which it is expected to confirm when it announces it half year earnings in a few days’ time. They will be very interesting, given the impressive results the Romanian group reported it had doubled its profits at the end of the last quarter.
Vodafone Portugal was recently denied the right to acquire Nowo after the competition regulator, Autoridade da Concorrência (AdC), decided it would not further competition in the market. In other words, it viewed Nowo as key in keeping the prices of its three larger rivals down.
Had it been allowed to proceed, Vodafone would have become Portugal’s second largest provider. As that route is permanently closed, maybe Portugal will become the third European market that Vodafone bails out of, having already exited Spain (selling out to Zegona Communications) and Italy (to Swisscom’s Italian subsidiary Fastweb) this year on the grounds they lacked sufficient scale to make a return on investment.
Saudi Arabia’s stc is looking to strengthen its presence in the Iberian peninsula. It already holds almost a 10% stake in Spain’s incumbent, Telefonica and was interested in acquiring incumbent Altice Portugal, but the two parties could not agree terms and negotiations ended last month, when it was reported in local media that stc was potentially interested in acquiring Vodafone’s Portuguese opco.