TPG Telecom will take $228 million of write-downs into its first-half results after the decision announced in late January to stop building its mobile phone network.
The telco says the write-downs total $228 million and are a form of accounting clean up after the decision to abandon its ambitious plan to build its own network.
The write-downs will appear in the accounts to be released early in March. TPG shares eased 0.6% to $6.59 yesterday.
TPG said it will write down the value of its spectrum licences by about $92 million and its mobile network capital expenditure by $76 million while writing off $60 million in interest expenses.
TPG paid $1.26 billion for mobile spectrum in 2017 and had spent $100 million of the $600 million in construction costs before scrapping its network plan in January.
While TPG blamed the decision to abandon the network on the Federal Government decision to ban Chinese equipment and mobile maker, Huawei from Australia, analysts say the decision has actually improved the chances of the mooted merger in this country with Vodafone.
The competition watchdog, the ACCC had expressed concerns that such a merger would see the number of mobile networks fall from four to three. With no TPG network, the number of networks will remain at three with TPG controlling the Vodafone operation.
TPG on Tuesday said it hoped, in the event of a successful merger, the mobile sites already built would be complementary to Vodafone’s mobile network.
