Shareholders of Germany’s troubled telecommunications giant MobilCom AG voted to accept a lifeline from France Télécom on Tuesday after a meeting that lasted 11 hours. Their agreement was necessary for the contract between the two companies to come into effect. France Télécom now has to seek the approval of its own shareholders to take over the 7 billion euro ($7.58 billion) debt incurred by MobilCom in its ill-fated investment in UMTS spectrum licenses.
During the meeting, MobilCom's chairman, Thorsten Grenz, said the high cost of the loans taken out to finance the UMTS technology had made it impossible to earn any money with it. An already existing UMTS plant worth around €1 billion will be dismantled if no buyer has been found by March, and the UMTS license will revert to the state without compensation if it cannot be sold. Grenz said there was little interest in the technology at present.