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Commercial banks

Multi-Billion Pound Auction for Mobile Phone Licences Reaches £22 Billion

Strategic Insights

— 1 min read

The highly anticipated auction for the next generation of mobile phone licences has reached a staggering £21.67 billion, with analysts predicting the battle will soon come to an end. The six remaining bidders, including UK-based operators and international newcomers, have been vying for the five licences on offer. Vodafone AirTouch has emerged as a leader in the bidding, with a £5.66 billion offer for licence B, while TIW and NTL Mobile, a joint venture between NTL and France Telecom, are also in the running. As the auction nears its conclusion, concerns are growing that the winners may struggle to meet the costs of winning, potentially jeopardizing their credit ratings.

Key Takeaways:

  • The total value of bids for the mobile phone licences has reached £21.67 billion, with six bidders remaining in the running.
  • Vodafone AirTouch has offered £5.66 billion for licence B, the best licence available to existing mobile companies.
  • TIW, a Canadian consortium, led the bidding for licence A with a bid of £4.38 billion, while NTL Mobile placed the highest offer for licence D at £3.89 billion.
  • BT, Orange, One2One, and two newcomers, TIW and NTL Mobile, are the six remaining bidders.
  • Analysts believe the auction could be resolved before Easter, with some forecasting the costs will be four times the original estimate.
  • The Treasury is expected to receive a windfall from the auction, with Chancellor Gordon Brown stating that any excess funds will be used to reduce national debt.
  • Royal Bank of Scotland has completed its integration of NatWest, having met its one-month targets for the deal.

Statistics:

  • Total value of bids: £21.67 billion
  • Number of bidders: 6
  • Licence B benchmark: £5.66 billion (Vodafone AirTouch)
  • TIW's bid for licence A: £4.38 billion
  • NTL Mobile's bid for licence D: £3.89 billion
  • BT's bid for licence C: £3.85 billion
  • One2One's bid for licence E: £3.89 billion
  • Royal Bank of Scotland's acquisition of NatWest: £21 billion

Sources:

  • (No specific date mentioned) - "Multi-Billion Pound Auction for Mobile Phone Licences Heats Up" (Source: Industry Expert, no specific publication or date)
  • (No specific date mentioned) - Royal Bank of Scotland press release announcing completion of NatWest integration targets
  • (No specific date mentioned) - Royal Bank of Scotland announcement on changing its financial year end

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