The Ministry of Communications has disqualified ISP 018 Xfone’s bid to buy the 3G licence it won in April. The number four ISP is owned by Marathon Investments, which offered the highest bid NIS710 (US$210m) in the auction. It failed, however, to gain…
The Ministry of Communications has disqualified ISP 018 Xfone’s bid to buy the 3G licence it won in April. The number four ISP is owned by Marathon Investments, which offered the highest bid NIS710 (US$210m) in the auction. It failed, however, to gain the guarantees it needed from Israel Discount Bank, while arguing that it would still be able to come up with the necessary funds.
Under the licence terms, winning bidders must be able prove they have guarantees of ILS705m (US$206m). Select Communications, which had been the number three bidder, will now win the right to the licence, provided it shows bank guarantees to support the licence within 45 days.
The bid is backed by Americans Michael Gelfand and Louis Mayberg and Israeli Shuki Gleitman.
Failing that, number four bidder Golan Telecom will win the licence. The company is backed by Xavier Niel and Mickael Boukobza, respectively the founder and former head of French ISP Free’s parent company Iliad. Number four cellco MIRS, which is controlled by French businessman Patrick Drahi, was the second winner in the auction, with a bid of NIS705m (US$206m).
The auction is part of the regulator’s efforts to increase competition in its telecoms sector, and follows a raft of recent MVNO agreements and plans to cut interconnection rates by 80 per cent.
The winners will join Cellcom, Pelephone and Partner Communications, which control a respective 34 per cent, 32 per cent and 28 per cent of the market.
