Virgin Mobile Central and Eastern Europe (VMCEE), a mobile virtual network operator (MVNO), has secured funding of up to €10 million ($12.9 million) to fuel its expansion in Poland, Turkey, and other parts of the region.
Dubai-based investment company Delta Partners Capital is leading the funding round through its Emerging Markets TMT Growth Fund II. Other contributors to the investment include World Bank member IFC, the European Bank for Reconstruction and Development, and CEE Mobile Capital.
VMCEE is in the early stages of providing MVNO services in the region. The company is pitching itself as a 'youth' brand, and is focused on providing mobile broadband services.
Alan Gow, the company's CEO, said the investment will enable it to "capture the significant opportunity for growth that exists in Poland, Turkey, and across the region." VMCEE will also benefit from Delta Partners Capital's "industry expertise and MVNO-specific experience," Gow added.
Delta Partners Capital is the investment arm of Delta Partners Group (DPG), an advisory and investment company focused on telecoms, media, and digital services in emerging markets. DPG chairman Kai-Uwe Ricke said the VMCEE investment will enable the operator to launch "creative, data-driven services for consumers in Central and Eastern Europe."
Ricke explained that his company is investing in VMCEE because it is a "global brand that is recognised as a consumer champion" and noted the funding comes at a time when the "MVNO world is undergoing rapid transition as consumers move from a voice to a data-centric world."
The funding agreement will see Ricke join the board of VMCEE, while Boris Nemsic--executive partner at Delta Partners Capital and a former CEO at Telekom Austria and VimpelCom--will join the board of Virgin Mobile Poland.
Fitch Ratings analysts in July noted that access to LTE networks will be crucial to the success of MVNOs throughout Europe, while commenting on Telefónica Deutschland's acquisition of rival E-Plus.
That deal was cleared by regulators after Telefónica Deutschland committed to opening access to the combined network to MVNOs--specifically access to LTE networks at commercial wholesale rates.
The ratings agency noted the approach could become a model for future MVNO deals in Europe, and said the European Commission had established "a clearer framework for MVNOs in the context of market consolidation."
For more:
- read Delta Partners Group press release [PDF]
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