Shore Capital takes controlling stake in German WiMAX operator DBD
Shore Capital, the UK investment bank, bought a 58 per cent controlling stake in the the German WiMAX operator Deutsche Broadband Dienste (DBD).
DBD, which launched its WiMAX network in 2005 and received investment of around €100 million over the past six years from Intel Capital, Bank of America Merrill Lynch, M.M. Warburg and others, has failed to achieve profitability.
Shore Capital, which is leading a consortium of new investors, is reported by the Financial Times to be planning to deploy 4G technology--thought to be Israeli-developed WiMAX--to provide additional coverage and capacity across Germany.
Shore Capital said it had formed a new company, Spectrum Investments, to acquire control of DBD and plans to expand the German company's offering to business customers and other mobile operators on a wholesale basis. Spectrum will work with DBD's management team to put these new changes in place, Shore Capital said in a statement.
In the statement, the investment bank said that it had invested €2.885 million to acquire a majority holding in Spectrum, which in turn would hold the controlling interest in DBD. The management of Spectrum will include a team of Israeli entrepreneurs who are co-founding the company.
Howard Shore, chairman of Shore Capital, said: "We are delighted to be expanding our principal finance activities with this opportunity in radio spectrum. We are excited by the plan to back this management team to use new technology to turn around the business."
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