Romanian telco upstart will be M&A party pooper

Digi Communications

30/11/2023 12:27

(The author is a Reuters Breakingviews columnist.  The opinions
expressed are her own.)
    By Pamela Barbaglia
       LONDON, Nov 30 (Reuters Breakingviews) - Originally a
mobile provider for Bucharest expats, Digi Communications is
expanding across Europe. It is taking market share thanks to a
low-cost model and as regulators force merging rivals to shed
assets. A wave of consolidation in Spain and elsewhere may yield
some surprises.
    Full view will be published shortly.
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    CONTEXT NEWS
    Digi Communications has reached a preliminary deal to
acquire assets from Orange and MasMovil, potentially clearing an
18.6 billion euro merger of their Spanish operations, Bloomberg
reported on Nov. 29.
    EU antitrust regulators warned in June that Orange and
MasMovil’s planned merger of their Spanish operations may reduce
competition and push up prices. The EU competition enforcer sent
a statement of objections to the companies on June 27, setting
out its concerns over deals that reduce the number of big mobile
telecoms operators in a market to three from four.
    Digi is in talks with Australian investment firm Macquarie
and UK fund manager Abrdn to sell a stake in its fibre optic
network in Spain as it seeks to raise cash to invest in the
country, newspaper Expansión reported on Sept. 27, citing
sources with knowledge of the process.
    Digi signed a five-year agreement on Aug. 28 to partner with
Belgian state-controlled telecoms firm Proximus and obtain
wholesale access to Proximus’ mobile network as it plans to
enter the market.
    Digi’s subsidiary Dixarobil won an auction in 2021 for
frequency bands in Portugal, where it is due to start providing
services in 2024.

 (Editing by Neil Unmack and Oliver Taslic)
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