Vodafone’s (LON:VOD) German unit has bought 5G spectrum for €1.88 billion, the blue-chip telecoms group has said. The company said that it had achieved its overall auction objective.
Vodafone’s share price has been little changed in London in today’s session, having given up 0.06 percent to 129.26p as of 14:23 BST. The stock is marginally underperforming the broader UK market, with the benchmark FTSE 100 index having climbed marginally into positive territory and currently standing 0.07 percent higher at 7,372.79 points. The telco’s shares have given up more than 30 percent of their value over the past year, as compared with about a 4.3-percent dip in the Footsie.
5G spectrum auction
Vodafone said that its German unit had acquired radio spectrum for next-generation 5G mobile networks at the Federal Network Agency auction for a total cost of €1.88 billion. The company said that it had achieved its overall auction objective and secured additional spectrum through to 2040. Vodafone Germany has acquired a total of 130 MHz.
“Vodafone is committed to bring the full benefits of a digital society to Germany through our gigabit network including 5G,” Vodafone’s chief executive Nick Read commented in the statement. “We believe it is important to have a balance between the price paid for spectrum and our strong desire to create an inclusive society through investment in mobile network coverage.”
Analysts weigh in on move
Proactive Investors quoted analysts at Mainfirst as commenting that Vodafone seemed “to have come off worse” in the auction. The newswire further reported that Deutsche Bank had said that the FTSE 100 telco’s UK business was likely to switch off its 3G network in three years to deploy lower-frequency spectrum for 5G as it looked to try and narrow the spectrum gap with Three, which announced on Monday that it would launch 5G in August with the highest speeds, helped by a superior spectrum position.
According to MarketBeat, the telecoms group currently has a consensus ‘buy’ rating, with the average target on Vodafone’s share price stands at 186.50p.