Ice Group awarded 700 and 2,100 MHz frequencies in Norway
Ice Group ASA’s subsidiary Ice Communication Norge AS has been awarded valuable frequency blocks in both the 700 MHz and 2,100 MHz bands in this week’s frequency auction organised by the Norwegian Communication Authority (“Nkom”).
“The outcome of the auction was exactly as we hoped for, giving us access to the frequency blocks we wanted at an attractive price. They will be highly valuable for the build-out of the third nationwide mobile network in Norway. This is a great day for both Ice Group, our shareholders and Norwegian consumers, who benefit from increased competition in the mobile market,” says Eivind Helgaker, CEO of Ice Group.
In the frequency auction, Ice Group was awarded 2 x 10 MHz in the 700 MHz band and 2 x 15 MHz in the 2,100 MHz band. The frequencies in the 700 MHz band are valid from 1 November 2019 until 31 December 2039, while the new frequencies in the 2,100 MHz band are valid until 31 December 2032.
The 2 x 10 MHz in the 700 MHz frequency band was awarded to Ice Group for NOK 131 million per 2 x 5 MHz frequency block, in total NOK 262 million. The 2 x 15 MHz in the 2,100 MHz band was awarded at the minimum price of NOK 25 million per 2 x 5 MHz frequency block, in total NOK 75 million.
Lower capex requirements
“The plans we have previously communicated to the capital markets were not dependent on securing frequencies in the 700 MHz or 2,100 MHz auction. As such, the outcome of this auction is a bonus to Ice Group and our shareholders. Additionally, capitalising on the benefits of the 700 MHz band will enable us to reach 95 percent population coverage with fewer base stations than originally planned. We therefore expect total capex for 2019 and 2020 to be lower than we have previously communicated. The additional frequencies will also allow us to tackle any unexpected increase in data consumption and secure our competitive position in the Norwegian market,” adds Eivind Helgaker.
The acquisition of the 700 MHz frequencies adds to the numerous initiatives and actions that Ice Group has initiated to reduce the company’s cash requirements since it presented its plans in December 2018. Following the NOK 1.5 billion private placement in January, these include the divestment of Ice Group’s Swedish operation, higher than predicted data on-net share, postponement of the least value accretive base stations, plus savings on transaction costs and deferred loan repayments as a result of the IPO process being terminated in December 2018. Ice Group is currently assessing various options to cover its remaining financing requirements.
Furthermore, the rules of this week’s frequency auction provide an opportunity to postpone payment of 90 percent of the final assignment price until 1 November 2021, if the bidder commits to invest minimum NOK 250 million in building mobile network infrastructure in the period. Ice Group will make use of this opportunity.
“The Norwegian government has in recent years repeated its intention to facilitate the build out of the third nationwide mobile phone network in Norway, with the objective of increasing competition and enhancing national infrastructure security. We would like to give credit to Nkom for organising the auction in a manner that supported the government’s objective,” says Eivind Helgaker.
In addition to the winning bids of NOK 262 and NOK 75 million, Ice Group will pay annual fees of NOK 37.9 million for the rights to the 700 MHz and 2,100 MHz frequencies.
All license holders in the 700 MHz band must secure mobile broadband access to 40 percent of the population in Norway within five years of the start of the license period, at a downlink bitrate of 5 Mbit/s per user. Frequency owners can use other bands than the 700 MHz to satisfy the requirement, which Ice Group already does through its mobile broadband offering in the 800 MHz band.
Prior to this week’s frequency auction, Ice Group held 18 percent of available mobile phone and mobile broadband frequencies in Norway, including blocks in the lower frequencies 450, 800 and 900 MHz and in the higher frequencies 1,800 and 2,100 MHz.
For further information, please contact:
Investors: Henning Karlsrud, CFO of Ice Group, tel: +47 930 45 389
Media: Reynir Johannesson, communication director, Ice Norway, tel: 465 48 595, email: firstname.lastname@example.org
About Ice Group ASA
Ice Group is a telecommunications company with nationwide networks in Norway and Denmark. In Norway, the company operates a pure 4G mobile network, providing smartphone, m2m, IoT and mobile broadband services to B2C and B2B customers. Ice Group also offers mobile broadband, m2m and IoT services in Denmark through its own network. Ice Group is listed on Oslo Axess (ticker: ICE). For more information, see www.icegroup.com.