KPN pulling out of 3G consortium to cut UK losses

KPN, the struggling Dutch telecoms group, announced yesterday it wants to cut its losses in Britain by selling its 15 per cent stake in Hutchison 3G, a mobile consortium it owns with Hutchison Whampoa and NTT DoCoMo.

The move will see KPN take a €1.2bn (£769m) write-off on the venture. Ad Scheepbouwer, the chief executive of KPN, said the stake was a "non-core asset" which would be sold along with other parts of the business that were not deemed to be crucial to KPN's future.

Hong Kong-based Hutchison said it would not take a write-down on its stake in the British third-generation mobile phone business. It said it would "keep its options open" about whether it would buy out KPN's stake.

KPN has not yet discussed its plan to exit Hutchison 3G with its two partners and is not thought to be in talks with any prospective buyers.

The struggling company unveiled its intention to sell this holding as it announced a €9.3bn net loss for the second quarter, due mainly to losses on a number of its mobile phone businesses.

Mr Scheepbouwer said the heavy charges reflected more pessimistic prospects for third-generation mobile phone technologies, the launch of which has been delayed by technical glitches and cash shortages among operators.

KPN's hefty write-off brought it into line with its rivals, which have also written off billions of euros in asset values in the wake of an 80 per cent drop in share prices since March 2000.

Mr Scheepbouwer said "reality has changed" in Europe's beleaguered mobile market. He added this meant that KPN, and its rivals, had to admit that they thought they would attract customers more quickly than has been the case, and that those customers would be prepared to pay more for services such as broadband internet access through their mobile phones.

KPN was more optimistic about its prospects for the full year, saying it expects to generate earnings before tax at least 14 per cent higher than last year. The figure was an improvement on KPN's forecast earlier this year that earnings would be 12 per cent higher this year.

KPN also emphasised its write-offs did not affect its operational free cash flow, which improved to a positive €412m from a negative €166m a year ago.

Start your day with The Independent, sign up for daily news emails
ebooksAn unforgettable anthology of contemporary reportage
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Digital Optimisation Executive - Marketing

£30000 - £35000 per annum: Recruitment Genius: The UK's fastest growing, multi...

Recruitment Genius: Financial Reporting Manager

£70000 - £90000 per annum: Recruitment Genius: A Financial Reporting Manager i...

Recruitment Genius: Payments Operations Assistant

£23000 - £25000 per annum: Recruitment Genius: They win lots of awards for the...

Recruitment Genius: Telephone Debt Negotiator

£13500 - £20000 per annum: Recruitment Genius: This nationwide enforcement com...

Day In a Page

Syria civil war: Meet the military commander who says his soldiers will not rest until every inch of their war torn country is free of Islamist 'terrorists'

‘We won’t stop until Syria is back to normal’

Near the front lines with Islamist-controlled towns where Assad’s troops were besieged just last month, Robert Fisk meets a commander confidently preparing his soldiers for battle
The inside story of how Bill Clinton built a $2bn global foundation may undermine Hillary's chances

The inside story of how Bill Clinton built a $2bn global foundation...

... and how it may undermine Hillary's chances in 2016
12 best olive oils

Extra-virgin, cold-press, early-harvest, ultra-premium: 12 best olive oils

Choosing an olive oil is a surprising minefield. Save yourself the hassle with our handy guide
Sepp Blatter resignation: The beginning of Fifa's long road to reform?

Does Blatter's departure mean Fifa will automatically clean up its act?

Don't bet on it, says Tom Peck
Charles Kennedy: The baby of the House who grew into a Lib Dem giant

The baby of the House who grew into a Lib Dem giant

Charles Kennedy was consistently a man of the centre-left, dedicated to social justice, but was also a champion of liberty and an opponent of the nanny-state, says Baroness Williams
Syria civil war: The harrowing testament of a five-year-old victim of this endless conflict

The harrowing testament of a five-year-old victim of Syria's endless civil war

Sahar Qanbar lost her mother and brother as civilians and government soldiers fought side by side after being surrounded by brutal Islamist fighters. Robert Fisk visited her
The future of songwriting: How streaming is changing everything we know about making music

The future of songwriting

How streaming is changing everything we know about making music
William Shemin and Henry Johnson: Jewish and black soldiers receive World War I Medal of Honor amid claims of discrimination

Recognition at long last

Jewish and black soldiers who fought in WWI finally receive medals after claims of discrimination
Beating obesity: The new pacemaker which helps over-eaters

Beating obesity

The new pacemaker which helps over-eaters
9 best women's festival waterproofs

Ready for rain: 9 best women's festival waterproofs

These are the macs to keep your denim dry and your hair frizz-free(ish)
Cycling World Hour Record: Nervous Sir Bradley Wiggins ready for pain as he prepares to go distance

Wiggins worried

Nervous Sir Bradley ready for pain as he prepares to attempt cycling's World Hour Record
Liverpool close in on Milner signing

Liverpool close in on Milner signing

Reds baulk at Christian Benteke £32.5m release clause
On your feet! Spending at least two hours a day standing reduces the risk of heart attacks, cancer and diabetes, according to new research

On your feet!

Spending half the day standing 'reduces risk of heart attacks and cancer'
With scores of surgeries closing, what hope is there for the David Cameron's promise of 5,000 more GPs and a 24/7 NHS?

The big NHS question

Why are there so few new GPs when so many want to study medicine?
Big knickers are back: Thongs ain't what they used to be

Thongs ain't what they used to be

Big knickers are back