Sunday, 04 December 2016

Review of the Year: Gaining Weight

By Mary Lennighan, Total Telecom
Thursday 20 December 12

2012 featured some major acquisitions, partnerships and alliances as telecoms operators looked to bulk up their businesses.

The start of a new year more often than not brings with it a desire for self improvement, and–in the developed world, at least–that often manifests itself in the form of a diet, as people either look to completely overhaul their lifestyles or simply shed a few extra pounds gained during the festive season. If you’re a telecoms operator though, the story is slightly different. The telcos are no stranger to shedding flab, something they have been working hard to do in the past year through extensive cost-cutting programmes. But many have been actively seeking to gain weight, with various mergers, acquisitions and alliances being the major headline-hitters of 2012. And with the operating environment likely to continue to be challenging, the trend of bulking up will prevail as we move into 2013. The past year was relatively quiet in terms of telco M&A until October, when a number of deals were announced that will change the landscape of the industry if and when they close next year. The biggest of the bunch was Softbank’s $20.1 billion agreement to acquire a 70% stake in US operator Sprint Nextel, the largest ever foreign acquisition by a Japanese company. Just weeks earlier Softbank had made its growth ambitions known, announcing a $2.3 billion stock swap deal for smaller domestic rival eAccess. The Softbank announcement came just days before Sprint revealed plans to increase its stake in wireless broadband operator Clearwire–which boasts significant spectrum holdings in the US, albeit in the 2.5-GHz band&ndash…

The start of a new year more often than not brings with it a desire for self improvement, and–in the developed world, at least–that often manifests itself in the form of a diet, as people either look to completely overhaul their lifestyles or simply shed a few extra pounds gained during the festive season. If you’re a telecoms operator though, the story is slightly different. The telcos are no stranger to shedding flab, something they have been working hard to do in the past year through extensive cost-cutting programmes. But many have been actively seeking to gain weight, with various mergers, acquisitions and alliances being the major headline-hitters of 2012. And with the operating environment likely to continue to be challenging, the trend of bulking up will prevail as we move into 2013. The past year was relatively quiet in terms of telco M&A until October, when a number of deals were announced that will change the landscape of the industry if and when they close next year. The biggest of the bunch was Softbank’s $20.1 billion agreement to acquire a 70% stake in US operator Sprint Nextel, the largest ever foreign acquisition by a Japanese company. Just weeks earlier Softbank had made its growth ambitions known, announcing a $2.3 billion stock swap deal for smaller domestic rival eAccess. The Softbank announcement came just days before Sprint revealed plans to increase its stake in wireless broadband operator Clearwire–which boasts significant spectrum holdings in the US, albeit in the 2.5-GHz band&ndash…

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