Blu infighting ends Italian UMTS auction

Italian mobile phone company Blu has withdrawn from Italy's UMTS auction after BT refused to take a higher stake in the consortium's bid.

BT had proposed to meet 21 per cent of the eventual 3G licence fee but other shareholders in the venture wanted the UK telco to raise its investment to 50 per cent. BT said it was unable to pay "the amount the other shareholders demanded, as the price for continuing the bidding was so high". Earlier in the day the company had shown its commitment to the Italian bid by offering a one-off cash injection of E258m (£150m). Blu's shareholders had been locked in emergency talks over the weekend but failed to reach any agreement. BT, BNL, Distacom, Intalgas and Mediaset had voted to continue participating in the auction but were blocked by shareholders Edizone Holding, Palatinus and Sitech. The consortium needed an 80 per cent vote in favour of continued participation to proceed and the 60:40 split brought to an end any hopes of Blu gaining a licence. It has also brought to an abrupt end the auction itself as Blu was the sixth remaining company bidding for the five available licences. The five other companies involved in the auction were Andala; IPSE, led by Spain's Telefonica; Omnitel, Telecom Italia Mobile and Wind, a joint venture of Italian utility Enel and France Telecom.