Romanian-owned Digi has again made the headlines, this time by agreeing to buy Portugal’s fourth largest operator Nowo Communications from Spain’s Lorca for €150 million.
The move is significant in that it signals a further expansion of Digi in Iberia, where it is already a leading provider of electronic communications services in Spain. Indeed, it ended the first quarter – its Q2 results are due out shortly – with 5 million mobile and 1.5 million broadband users, up 23.6% and 56.7% respectively on the previous year.
The acquisition of Nowo Communications, which is subject to competition clearance, will see Digi take over a company that currently has around 270,000 mobile and 130,000 fixed telecom, including pay-TV, customers. Nowo also holds spectrum licences in the 1800, 2600 and 3600 MHz frequency bands.
News of the acquisition also follows almost a month to the day since the Portuguese Competition Authority (AdC) ruled against Nowo’s proposed take-over by Vodafone on the grounds that it would lead to significant price rises at Nowo – up to 55% in the case standalone mobile services – enhance Vodafone’s market power, increase entry barriers and facilitate “coordinate behaviours” among the three leading operators.
Interestingly, Vodafone tried but ultimately failed to address these concerns by proposing four “commitment packages”, one of which suggested selling frequency rights recently acquired by Nowo to Digi and providing Digi with a wholesale offer on Vodafone private network.
Separately, in June the Portuguese regulator ANACOM warned the three leading operators MEO, NOS and Vodafone not to obstruct Digi’s entry into the market. The Romanian company already holds 5G licences and is expected to launch commercial services by the end of the year.
All the signs look promising for Digi, with the acquisition of Nowo being only the latest step in its transition from a company solely focused on the CEE electronic communications marketplace to one expanding across Western Europe while remaining the leading operator in its home market Romania.
© Chris Dziadul, 2024
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