Gov't opposes sale of Xfone to Widely Mobile

Shmaya Reichman  credit: PR, Widely Mobile

Shmaya Reichman's Widely Mobile plans to run Xfone as a mobile virtual network operator on the Pelephone network.

Sources inform "Globes" that the Ministry of Finance is fiercely opposed to sale of mobile telephony company Xfone to Widely Mobile, and the government is adamant in its position that as long as the possibility exists of Xfone being acquired and continuing as a full mobile carrier, that is the preferred option. The Ministry of Communications has even turned to the court over the matter. It is believed that the Competition Authority too will also prefer a deal whereby Xfone continues to be a full mobile carrier.

Last Thursday, the special administrator appointed to Xfone, Adv. Amit Lederman, decided to recommend the sale of the company to Shmaya Reichman's Widely Mobile, which proposes to operate it as a mobile virtual network operator (MVNO) on the Pelephone network.

The decision was greeted by surprise at government ministries. As far as the state was concerned, it was clear that the bid by the group led by Itzik Ben-Eliezer and Cellcom Israel Ltd. (NYSE:CEL; TASE:CEL) to buy Xfone's business and continue to operate it as a going concern would tip the balance, but, as mentioned, the administrator decided otherwise. At the end of the week, the government therefore decided to go to court. A hearing on the administrator's decision will be held today.

In its court filing, the Ministry of Communications stresses the importance of Xfone remaining a mobile carrier with an independent network, in order to ensure investment in advanced telecommunications infrastructure, in which Israel lags the rest of the world. The ministry states that it will find it difficult to approve a bid that is not consistent with that principle, as long as other options exist that are closer to it. The ministry asks for time to formulate a professional recommendation for the minister of finance, and for him to exercise his legal powers.

Published by Globes, Israel business news - - on September 5, 2021

© Copyright of Globes Publisher Itonut (1983) Ltd. 2021

Shmaya Reichman  credit: PR, Widely Mobile
Shmaya Reichman credit: PR, Widely Mobile
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