ITG Group is taking a 30 per cent stake in mobile phone newcomer Cellular 3 for £10 million (€12.7 million). The two companies will work together to take advantage of new opportunities presented in the mobile and fixed-line markets, according to Mr Sean Bolger, the chief executive officer of Cellular 3. The possibility of combining to bid for a third generation mobile phone licence next year will be explored, he said. Cellular 3 was established earlier this year by Mr Bolger. It buys mobile time in bulk from Eircell and sells it on under the Imagine brand. The company currently has around 20,000 customers but is involved in a protracted legal battle with Eircell, which claims that Imagine needs a special licence in order to resell mobile time under a separate brand name.
Cellular 3 plans to introduce a pre-paid mobile product in the next few weeks as well as a convergent service that will allow businesses to have a single phone number for their fixed line, mobile, fax and email. ITG's main interests are in pay phones and credit card services. It also operates a chain of terminals that allow Esat Digifone customers to top up their pre-paid mobile phones. Eircell has refused to allow the company offer the same service to its customers. "This investment is a key part of our overall strategy for the future of our voice and data business and significantly advances our plans for that strategic group, now a major player in the domestic telecommunications market," said Mr John Nagle, the chief executive of ITG.
Mr Bolger said yesterday the link with ITG will be the model for the company's plan to offer a pan-European mobile network by buying time in bulk from mobile phone companies across Europe. "We plan to work with different European companies," he said. Under the terms of the deal, ITG will pay £5 million for an initial 15 per cent stake in the company. It will increase its holding to 30 per cent by paying another £5 million "within weeks", said Mr Bolger. A nominee of ITG will join the board of Cellular 3. The company had been in discussions with a number of potential partners in recent months, said Mr Bolger. The decision to sell part of the company to ITG was not driven by financial considerations, he said.
