Gavin1205
Well-Known Member
THE new shareholders of Virgin Mobile SA will invest R200m in the company this year to enhance its competitive advantage and launch new products in the market.
Virgin Mobile announced yesterday Cell C would sell its 50% stake in the company to Virgin Mobile Group and telecoms investment company Calico Investments, for an undisclosed amount. Virgin Mobile Group, owned by UK businessman Richard Branson, will increase its stake to 55% while Calico will own 45%. Virgin Mobile will continue to roam on Cell C’s network.
Virgin Mobile was launched in 2006 to sell its own branded starter packs aimed at the more affluent consumers and business users, while Cell C focused on the lower end of the market. It was banking on the Virgin global brand to win customers and gain 10% market share in three to five years. But stiff competition made it impossible to achieve those targets. It has 300000 customers.
CEO Steve Bailey said Virgin Mobile grew its contract customers by 80% last year and "the new investment will help us continue on that path. We will add broadband products to the portfolio this month."
He said the company’s revenue last year was more than R1bn.
Lars P Reichelt, CEO of Cell C, said the change in shareholding was part of a strategy to provide a platform for growth for mobile virtual network operators.
Such an operator piggybacks on another company’s network and sells its branded cellphone starter packs. Cell C this week announced such a partnership with Red Bull.
Unlike Virgin Mobile, Cell C and Red Bull did not form a separate company. Instead, Cell C will provide the network, billing and customer service support while the marketing and branding will be done by Red Bull. The starter packs will be sold at Cell C’s shops.
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Virgin Mobile announced yesterday Cell C would sell its 50% stake in the company to Virgin Mobile Group and telecoms investment company Calico Investments, for an undisclosed amount. Virgin Mobile Group, owned by UK businessman Richard Branson, will increase its stake to 55% while Calico will own 45%. Virgin Mobile will continue to roam on Cell C’s network.
Virgin Mobile was launched in 2006 to sell its own branded starter packs aimed at the more affluent consumers and business users, while Cell C focused on the lower end of the market. It was banking on the Virgin global brand to win customers and gain 10% market share in three to five years. But stiff competition made it impossible to achieve those targets. It has 300000 customers.
CEO Steve Bailey said Virgin Mobile grew its contract customers by 80% last year and "the new investment will help us continue on that path. We will add broadband products to the portfolio this month."
He said the company’s revenue last year was more than R1bn.
Lars P Reichelt, CEO of Cell C, said the change in shareholding was part of a strategy to provide a platform for growth for mobile virtual network operators.
Such an operator piggybacks on another company’s network and sells its branded cellphone starter packs. Cell C this week announced such a partnership with Red Bull.
Unlike Virgin Mobile, Cell C and Red Bull did not form a separate company. Instead, Cell C will provide the network, billing and customer service support while the marketing and branding will be done by Red Bull. The starter packs will be sold at Cell C’s shops.
LINK