MobilCom writes down 3G investment

MobilCom has taken a massive third-quarter write-down on its mobile broadband licence and infrastructure after abandoning plans...

MobilCom has taken a massive third-quarter write-down on its mobile broadband licence and infrastructure after abandoning plans to build a 3G network.

The wireless operator, which was recently rescued from the brink of bankruptcy by shareholder France Télécom, wrote down €9.9bn (£6.3bn) on its 3G mobile broadband network investment, the company said.

MobilCom said it would offset most of the charge with a €7.1bn (£4.6bn) bailout package agreed with France Télécom. France Télécom agreed to take over €7bn of MobilCom's debts and liabilities and pay €580m (£372m) toward the cost of halting the 3G project.

The net write-down for MobilCom would be €2.8bn (£1.8bn), it said.

Earlier this week a MobilCom spokesman said the company plans to hang on to its 3G licence until at least the end of 2003 by which time it must provide 25% coverage.

If MobilCom fails to meet this condition, it must return the licence to the German government, according to a spokesman for the country's telecom regulator RegTP.

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