Quam Quits for GoodQuam Quits for Good
T-Mobile set to inherit Quam's customers, while fellow struggler MobilCom holds on by its financial fingertips
October 14, 2002
Group 3G, the German mobile joint venture of Telefónica Móviles SA and Sonera Corp. (Nasdaq: SNRA) that goes by its brand name Quam, is to close its network on November 15 and advise its 200,000 or so subscribers to hook up to T-Mobile AG. The JV has been beset with problems and has quit before it pours more good money after bad (see Dead End for German 3G Dodos).
According to media reports the failed service provider will receive a one-off €50,000 and then between €100 and €200 for every Quam sub that makes the switch.
As Quam packs its personal belongings into a box and prepares to turn off the lights, fellow German struggler MobilCom AG looks to have a stay of execution from the 17 creditor banks that would, under healthy economic conditions, have had €4.7 billion in loans repaid today. This will be the third time the repayment deadline has been extended.
Rather than force the service provider into insolvency, it seems the banks are holding out for France Telecom SA (NYSE: FTE), still a 28.5 percent stakeholder in MobilCom, to put its name to a deal that would see the financial institutions get securities that are convertible into France Telecom shares.
MobilCom is due to announce its Q3 results on November 12. France Telecom will have to put pen to paper if those results are to have any forward-looking statements that involve solvency.
As both Group 3G and MobilCom are holders of 3G licenses, German regulator Regulierungsbehörde für Telekommunikation und Post (RegTP) can reasonably expect the return of some paperwork in the next few months.
— Ray Le Maistre, European Editor, Unstrung
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