Pakistan's smallest operator, Warid Telecom, was recently put on the block by its owners, The Abu Dhabi Group. Its likely sale is expected to fetch up to $1 billion.
The country – which is seen as an emerging telecoms market – has experienced widespread international investment in recent years, and it is unlikely that The Abu Dhabi Group will be short of bidders as companies continue to look for opportunities in high-growth markets.
Etisalat emerged as an early favourite to snap up the company, particularly due to its ties with The Abu Dhabi Group and its existing operations in Pakistan. The company already owns a stake in Pakistan Telecommunication Co (PTCL) and a deal for Warid would give Etisalat the opportunity to consolidate in the market.
There are five operators in Pakistan and there are suggestions that Norway-based Telenor and Russian operator VimpelCom are also interested in utilising a buyout of Warid Telecom to facilitate in-market consolidation. China Mobile has also been touted as a potential suitor.
A spokesperson for VimpelCom, which owns Mobilink Pakistan, responded to the rumours by stating that "in-market consolidation would be positive for Pakistan".
Indeed, the Russia-based operator has been the most vocal since the news regarding Warid broke. If the rumours are correct, Etisalat has already hired Goldman Sachs as its advisor and is making its move. The other operators will have to act fast if they are genuinely interested.
There has certainly been a lot of speculation on potential consolidation in the Canadian market, but is it all talk?
In April, the Canadian Wireless Telecommunications Association (CWTA) was accused of being biased towards the country's "Big Three" operators: TELUS, Rogers Communications and BCE Bell Nexxia.
As a consequence, WIND Mobile, Public Mobile and Mobilicity all removed themselves from the group, claiming the CWTA showed a blatant disregard of new entrants to the market, and stating that the association could no longer speak for the industry as a whole.
Later on in May, TELUS agreed to acquire Mobilicity for C$380 million – a deal which fell through less than a month later, after it was blocked by the Canadian government.
Following this, Orascom withdrew its bid for a controlling stake in WIND Mobile, although reinforced its interest in the company as a minority shareholder. Mobilicity has since reiterated that it is "working diligently to reach an acquisition agreement", and Verizon has been highlighted as a potential buyer.
Alek Krstajic, CEO of Public Mobile, has voiced concerns about the Canadian marketplace, and although he is pushing for consolidation, does not see Public Mobile as the consolidator. The need to combine WIND, Public Mobile and Mobilicity is pressing, Krstakic says, but "[although] we see ourselves having a place in consolidation; it's not clear who the consolidator is yet".
In defiant response to the security concerns that have driven it out of the US market, Huawei is aggressively targeting growth across Europe.
After several unsuccessful projects and contracts with US partners, Eric Xu, EVP at Huawei, confirmed the company's exit from the market in April this year. "We are not interested in the US market anymore," he said. "Generally speaking, it is not a market that we pay much attention to."
Its focus has instead been switched to Europe, where it has experienced steady progress so far in 2013. "Europe is Huawei's most important strategic market," Roberto Loiola, VP at Huawei, confirmed to reporters.
Huawei partnered with Italian operator Wind earlier this year to enhance the company's 4G infrastructure, in a deal deemed to be one of the five largest for LTE in Europe.
The Chinese vendor was also selected by Swisscom as a partner for its FTTS expansion across Switzerland, and it also signed a network management deal with Vodafone Spain.
Its European strategy appears to be paying off, with Huawei reporting an 11% revenue increase for the first half of 2013.
Leveraging this growth, Huawei is now planning to open an office in London, to embrace its newly found Western European business, focussing on risk activities such as foreign exchange, counterparty and country risk.
Huawei hopes the office will complement its relationships with global banks and financial institutions worldwide, as it looks to strengthen its position in the continent. Bankers are also said to supportive of the move, as there is a bigger drive to raise capital.
EdgeCast Networks' recent round of funding raised approximately $54 million, and has again led to the company targeting further expansion in the CDN space.
However, confidence in the company has also led to market watchers questioning whether the thriving company will go public, or be subject to a carrier buyout.
The company has turned over a profit in the last four years, and continues to slowly build itself up as a viable alternate CDN player to both Akamai and Limelight.
James Segil – president and co-founder of the company – told Capacity the new round of funding would be used to strengthen its footprint across the world and boost security initiatives.
It is the LA-based startup's third round of funding, with the company now up to $74 million in funding to date.
Segil said none of the company's original investors had pulled out, because of the potential that EdgeCast holds. It already
resells its CDN services to global operators AT&T and Pacnet, and a potential buyout from a carrier might not be out of
the question.
Carriers across the world have either been outsourcing or acquiring CDN companies to complement their portfolios. And with an increasing amount of investment in the company, could EdgeCast investors be looking for a large scale pay-off in the near future?
The spin-off of Telecom Italia's fixed-line network has been under intense media scrutiny since May this year, but a deal is still yet to materialise.
Telecom Italia valued its fixed-line network at €13-15 billion towards the end of May, and confirmed plans to separate the business shortly afterwards.
Luca Schiavoni, regulation analyst at Ovum, says that the separation of these assets would give the company more flexibility in the retail market.
"It will also be a way to reduce its debt and find new sources of profit, given that access services are no longer as profitable as they used to be... due to the downward trend of regulated access prices for services such as LLU and Bitstream," he said.
At the beginning of July, reports emerged that the company was in talks with a Qatari funds group to sell a stake in the fixed-line business.
Come the middle of July and Telecom Italia had suspended the sale entirely. The decision came after regulator AGCOM's proposal to cut the rate for competitors to access the company's fixed-line network. The company said the regulator's decision could affect the feasibility of the fixed-network separation and are suspending the plan until the impact can be evaluated.
After an agreement to buy Scartel, a 4G service provider and subsidiary of Yota, MegaFon's aggressive LTE growth strategy in Russia is beginning to pay off.
The company has been discussing merger opportunities with Yota since July 2012, and the deal for Scartel – worth an estimated $1.2 billion – acts as a logical step towards this goal.
"In terms of strategy, the Scartel acquisition is fully justified, as it strengthens MegaFon's position," says Anna Kurbatova, analyst at Moscow's BCS Financial Group.
"However, it's hard to say yet if MegaFon is overpaying or not, as the company didn't disclose any financial information."
The Scartel acquisition will boost MegaFon's long-term competitive advantage against rival Russian operators MTS and VimpelCom, and a successful acquisition of Yota in its entirety has the potential to accelerate the development of next-generation mobile technologies across the nation.
"The deal would only result in a major advantage [to Megafon] in the long term," Kurbatova adds.
However, later reports from unnamed sources have indicated that following the acquisition of Scartel, MegaFon intends to abandon all interest in the Yota brand.
A local website, citing sources close to Scartel's management, says that MegaFon is reluctant to develop the brand any further.
There is no smoke without fire. And there has been a lot of smoke coming from the direction of South African operator Neotel over the last three months.
The telecoms industry is wash with rumours that Vodacom, MTN and Dimension Data's Internet Solutions are all lining up as potential suitors for the company, which is majority owned by Tata Communications.
Neotel has denied it is for sale, yet its fixed-line assets would be an attractive proposition, particularly as it could present fixed-mobile convergence opportunities to the two mobile operators, Vodacom and MTN, which are operating in an increasingly saturated mobile market.
Furthermore, Neotel boasts a strong foothold in the enterprise segment – in which it reported a 29% growth in corporate customers last year – and is in possession of a valuable block of spectrum in the 800MHz band.
Launched in 2006 to bring much-needed competition to the South African market, Neotel has not quite lived up to expectations, and it remains to be seen how patient its shareholders will be if an offer does materialise.
Since Libya held its elections in July 2012, there have been persistent murmurings that the state-owned operator Libyan Post, Telecommunication and Information Technology (LPTIC), will be privatised and the market will be opened up to new competition across the country.
Libya remains plagued with instability, but telecoms is seen as playing a major role in driving economic growth in order to help get it back on its feet. And the wholesale telecoms industry has been surprised at just how quickly the incumbent has gone about doing that.
First, it resumed a partnership predating the civil unrest in Libya with OTE Globe to launch a subsea cable linking the nation with Greece, which went live in January of this year. Last year, it also struck a partnership with Epsilon to extend its connectivity across Europe.
"Often it takes a long time for operators [from war-torn countries] to recover and make a bold move. However, we have been very surprised with the speed and responsiveness we experienced during the initial conversations and set-up process," says Epsilon CEO Andreas Hipp. "Libya is certainly an interesting country for our customers."
As the country continues to rebuild – with some sources estimating that more than $1 billion worth of telecoms infrastructure was destroyed in the civil war – the demand for international internet transit is expected to increase, presenting a fresh market opportunity for carriers.
A lot will depend, however, on whether Libya opens up both its domestic and international operating licences.
"That is the biggest question," Hipp elaborates. "Local licences may help to improve infrastructure domestically, but operators can struggle when governments keep the international gateway licences either as a monopoly, or perhaps a duopoly. Since most of the content is overseas, internet will always be quite expensive to access, as it will be reliant on those one or two licence holders."
Europe's most prolific purchaser
Liberty Global has been one of the most active buyers in Europe so far in 2013, as the international cable company looks to potentially move deeper into the fixed-line and broadband segment.
In June it completed its $24 billion takeover of Virgin Media, marking one of the largest shake-ups in the UK telecoms and media sector since the 2010 merger of mobile network operators T-Mobile and Orange UK. It also pitched Liberty's owner into direct competition with his former partner Rupert Murdoch, controller of BSkyB, which also offers triple play TV, broadband and telephone services.
In late July, Liberty went on to increase its stake from 15% to 28.5% in Dutch cable firm Ziggo, which provides cable TV, broadband and telephone services to 56% of the Netherlands.
The company has been less successful in the German market. Its pursuit of Kabel Deutschland appeared to come to an end when it was outbid by Vodafone, which is expected to complete the acquisition in October.
Meanwhile, at the time of writing, its €3.2 billion purchase of Kabel Baden-Württemberg has been blocked by a German court. Liberty agreed to buy Germany's third-largest operator in March 2011, but the German antitrust regulator is re-examining the case following a challenge by Deutsche Telekom.
As a major force in the cable market, Liberty is expected to continue playing an important role in the consolidation of the European telecoms marketplace.
US operator Verizon has not exactly been shy about its feelings for Vodafone's 45% stake in Verizon Wireless, its joint venture with the UK-based group.
Rumours were rife at the start of the year that Verizon was set to launch a mammoth bid of up to $120 billion, as quoted in some national reports, which would make it one of the largest M&A deals of all time.
The main concern for Vodafone at the time was not only losing its most lucrative asset, but also the fact that it would not be able to offset the loss in revenues from the US in its core European market sectors.
Since then, the company has made strides in Germany and secured a deal to acquire Kabel Deutschland for approximately €10 billion, as it sets out a multi-play strategy in Europe.
It is unlikely Verizon's interest in securing the US stake has waned, despite the company going relatively quiet on that front, and recent comments from Vodafone now suggest they would be open to discussing a potential deal, "if we see proposals that generate more value for shareholders," said Gerard Kleisterlee, chairman of Vodafone, last month.
CEO Vittorio Colao said he would further put his reputation on the line in ensuring the company's most prized asset would be sold at the right time and at the right price. He will not bow to pressure, but how long can Vodafone resist Verizon's persistant advances?
{Since this article was written, the Vodafone-Verizon deal has been confirmed.]
