In 2014 the Swedish government decided to open the 700 MHz band for mobile broadband, but in 2016 cancelled the auction of the frequency, which is suitable for mobile broadband services in rural areas, pending an investigation into whether the emergency services could use part of band. The government has now decided that the Post and Telecom Agency (PTS) may continue with the auction, starting 1 November. The problem now is that PTS is impairing competition on the Swedish market, writes Johan Johansson, chief executive of 3 in DI on Saturday.
Sweden has four mobile operators providing strong competition on the market, but under new PTS guidelines this will be impaired. Not only will rights cost more, which will make it harder for smaller operators to take part in the bidding process, but in reality just two actors will be able to buy the rights to the entire 700 MHz band, which will probably be used for 5G. The government is thereby giving Telia preferential treatment allowing it to offer 5G services on unequal terms, claims Johansson.
Johan Dennelind, the chief executive of Telia Company, has confirmed that the operator is interested in acquiring Denmark’s TDC, but that the price is too high. One major uncertainty for Telia is whether the Swedish government will agree to a rights issue to finance such a deal, which would dilute the state’s 37.3% stake in the operator. Enterprise Minister Mikael Damberg is reticent, merely saying that the government would be prepared to discuss the issue with Telia, and that it has no immediate plans to divest its holding.
The Telia management is keen to acquire Danish operator TDC, according to Dagens Industri sources. However, if Telia is to realise its plans, it will have to raise money to fund the deal through a rights issue to shareholders. TDC is valued at some SKr 40 billion. It is uncertain how the government, which owns a share in the operator, would react to such a move though.
The business daily also reports that TDC intends to take measures to avoid being bought out, and has plans to make an offer on Swedish broadband and cable operator Com Hem, valued at SKr 17 billion.
Authorities in the USA and the Netherlands want Telia Company to pay 1.4 billion, around SKr 12 billion, in a settlement for the Uzbekistan deal.
Telia’s management estimate the proposal covers all ongoing investigations in all countries, including Sweden, although not criminal accusations against individuals in the Swedish preliminary investigation.
CEO Johan Dennelind says that it is difficult to make detailed comments before the proposal has been gone through in detail. “Many times before I have said that Telia Company went into Uzbekistan in an unethical and wrong way and we are prepared to take responsibility for that,” he says.
The authorities are investigating transactions Telia made whilst establishing a presence in Uzbekistan in 2007. Swedish TeliaSonera, Russian-Norwegian Vimpelcom and Russian MTS are suspected of having bribed Gulnara Karimova, daughter of Uzbekistan’s then president Islam Karimov.