Network outage for 3 as they buy O2 for €780 million.

Telefonica has agreed to sell its Irish unit O2 for €780m to Hutchison Whampoa subsidiary 3 Ireland, Hutchison said in a statement this morning.

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The deal, which is subject to regulatory approval, includes an additional deferred payment of €70m after the achievement of agreed financial targets, the statement said.

The sale to 3 Ireland, which is subject to regulatory approval, includes an additional deferred payment of €70m after the achievement of agreed financial targets.

Hit by the economic downturn in Europe, and especially its home market where 27pc of the workforce is unemployed, Telfonica is aiming to cut its debt to less than €47 billion by the end of the year.

It has already disposed of its treasury stock and 40pc of its Central American interests so far this year and Latin America now counts for over half the company’s revenues.

If approved the Irish deal will combine Ireland’s second largest mobile operator behind Vodafone, with Hutchison’s 3, the third largest operator, and take 3 Ireland’s market share to 37.5pcwith 2 million active subscribers.

Analysts at Espirito Santo said the O2 Ireland sale was a good move for Telefonica despite the sale price being a 10pc discount to the unit’s fair value since the business was small and not central to its strategy.

“This should enable Telefonica to reduce its leverage by approximately 1 percent at the end of 2013,” they said in a note.

Barclays and Bank of America Merrill Lynch advised Telefonica on the deal.

What do you think tell us.

Also today 3 suffered a blackout and claim its the first since 2005 ,talk about bad timing.

Three Ireland said the problem was caused by a transmission link failure by Virgin Media which affected Three services across Ireland.

“We have the best team working to address this and the service is expected to resume shortly. We apologise to customers for the inconvenience.”

There is very mixed thoughts on the deal that 3 struck so do tell us what you think and what it means.

Some info sourced from rueters.

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6 thoughts on “Network outage for 3 as they buy O2 for €780 million.

  1. I was just in the 3 shop on Grafton Street and they don’t have a single Nokia Lumia in their line-up. They carry 3 Nokia phones in total – the C2, the 300 and the 302. I wonder what it means for Nokia now that they will also own O2? Can we expect that that giant network (based on % share of the Irish market) will ditch Nokia? 3 carry only 2 WP phones, the HTC 8X and 8S – hardly inspiring.

    • And while I’m at it, what the hell are Nokia Ireland doing all day? Their business is selling phones. The Irish market is dominated by the carriers and by subsidised phones, and yet the networks here rarely push Lumia phones to people looking for a smartphone. Now, they’re going to have the largest network in the country probably not offering Lumia’s at all. If they’re not in a meeting with 3 right now, as I type, they’re not doing their jobs.

      • I can’t believe I put an apostrophe in a plural. The shame. Lumias, not Lumia’s. Eesh.

  2. Do you think there’s anything they can do about it? What does it take in this market to get a network to pick up your phone? The 620, in particular, should be selling out the door in Ireland, but I’m not sure if anyone at all has it. The fact of phones being so heavily subsidised here is skewing the market where high end phones are so cheap on contract that the low end really suffers. Everyone wants the biggest and best, where in the Lumia lineup, the real value and competitive advantage is at the middle and low end. Do you think they should try to change people’s behaviour and try to get people to by sim-free? A campaign that showed how much your phone really costs over the course of your 24 month bill might make people consider a €150-€199 520 or 620 over a free S4. Of course, that might upset the carriers further. They should also be targetting Tesco in a big way. The 520, for example, offers a much better user experience than a low-end Android (Galaxy Y series etc) and people on the Tesco network are probably going to be value conscious buyers. Of course the 925/S4/One/iPhone will get the headlines, but getting 520s and 620s into the hands of teenagers is a way to increase your profile and build a user base for years to come.

    Sorry for rambling. I love Nokia, I’m not ashamed to say it. I love that they’re one of the world’s greenest companies, that they have award-winning equality policies and that they make great hardware and some really cool software. It’s killing me that worldwide, and in Ireland in particular, they’re being let down by a sales department that doesn’t seem to be able to sell.

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