Proximus and Orange Belgium announced their deal to share mobile access network by the end of the year.
Dominique Leroy, CEO of Proximus and Michael Trabbia, CEO of Orange Belgium, have signed the term sheet.
Proximus and Orange Belgium aim to consolidate their existing Radio Access Networks such as Masts, Antennas, Radios, Base stations, into a shared common network. The sharing will be applicable across all technologies — 2G, 3G, 4G and 5G and at national level.
The shared network will improve coverage, with the consolidated number of mobile sites expected to be about 20 percent higher compared to each operator’s current stand-alone radio access network.
The scope of the sharing agreement would lead to an estimated recurring annual cash flow benefit of €35-€40 million for Proximus as of 2024, resulting from a lower Opex and Capex need to operate its mobile network after the consolidation.
Opex savings include lower rental fees, energy, repair and maintenance. Savings in Capex are mainly related to lower investments needed for 5G deployment, new sites and site relocation.
Proximus said the set-up investment required would be around €140 million in total over the 3-year period 2021-2023 to enable the mobile network sharing. This cost is expected to be partly compensated by some benefits of the shared network.
Proximus estimates the incremental cost on Capex and Opex will be limited to about €75 million, spread over 2021-2023.
Orange Belgium expects this deal to deliver cumulative Opex and Capex savings of €300 million over 10 years. Orange Belgium will spend €130 million over the next three years to implement this agreement.