"The company's assets will be sold to four different operators," said Blu spokesman Gianni Buttitta. "It's the disposal plan which is unique."
Italy's fourth Global System for Mobile Communications (GSM) operator, Blu was founded three years ago and marketed its services under the slogan: "The future that didn't exist." But it failed to win a third-generation (3G) Universal Mobile Telecommunications System (UMTS) licence, pulling out of the competition after the first round of bidding in October 2000 and becoming embroiled in lengthy litigation in order to recover its 4 trillion lire (£1.38bn) deposit from the government.
With an estimated 1.5 million subscribers and an acute shortage of funds that its shareholders have been unwilling to make up, time has rapidly run out for the company. On Thursday, Blu delivered its break-up plan to the communications ministry, stressing the need for rapid authorisation. The company's assets will be divided up between four of its competitors: Telecom Italia Mobile (TIM), Wind, Omnitel and H3G, Blu said.
Under the plan, H3G will acquire the majority of Blu's 1,000 transmission stations, which will form the basis of its new UMTS network, the Milan business daily Il Sole 24 Ore reported last week. Wind will take over Blu's clients and the brand name, while the company's GSM frequencies will be divided evenly between the four buyers, the paper said. TIM will acquire Blu's entire share capital, taking advantage of the company's losses for tax purposes, it said.
Buttitta confirmed the report. "The idea is that the sale should have a neutral impact on competition in the market." The plan takes account of expressions of interest from the four purchasers and was supported by all seven of Blu's shareholders, he said.
Rapid approval was essential to stave off the risk of bankruptcy, Buttitta added. Blu's debts have already surpassed €500m (£311.7m) and its suppliers are becoming increasingly impatient, according to Il Sole 24 Ore.