Given the carriers’ huge margins, it’s not an every-day scene to have a company going under. Well that just happened with Japan’s number four mobile operator Willcom, which has filed for bankruptcy with 206 billion yen (about $2.2 billion) in debt. The move won’t please anyone, especially not the U.S. private equity group Carlyle that has 60% stake in the company.
Willcom is now seeking assistance from the Enterprise Turnaround Initiative Corp of Japan, and is in talks with Softbank over a financial bailout. The company had hard time competing with NTT DoCoMo, KDDI and Softbank as the carriers have all been upgrading their networks. Not offering high-speed data in the Land of the rising Sun won’t lead you anywhere. On the other hand, keeping up with the Joneses (three major carriers) costs a fortune.
Willcom ended last year with 4.24 million subscribers, and has already asked for financial protection (ADR) last September. It will keep offering the service until it works out a new restructuring plan.
And for the record, in addition to Carlyle, Willcom’s other shareholders include KDDI and Kyocera, which hold 10% and 30% stake, respectively.
[Via: CellularNews]