German utility group Viag AG has been driven to sell its holding in distributor Computer 2000 AG because of huge losses and disappointing progress in its telecoms venture Viag Interkom GmbH, according to German analysts. The magazine Der Spiegel reports growing criticism by Viag executives over the $400m sale of its 80% interest in Computer 2000 to Tech Data Corp, the Clearwater Florida company. The move will create a $12bn global distributor. While the Viag board is currently considering final approval for the deal, Joeri Sels at Bank Julius Baer applauded the move. Computer 2000 is seen as a consumer business while most of Viag is in electricity and packaging, Sels said. And they will need resources for telecommunications. Deser added that Viag had plenty of divisions to take care of, without Computer 2000’s continuing recovery. BHF Bank’s Thomas Deser added that Viag had plenty of divisions to take care of, without Computer 2000’s continuing recovery. I see it as very positive, he said. The telecoms operation Viag Interkom GmbH is running behind schedule and may not break even by 2001 as its parent had hoped. I find it disappointing how slow it is going, said Sels, who estimates that start-up losses could total $1bn by 2001. Deser said the opportunity for Interkom was narrowing. Viag Interkom wanted to integrate fixed and mobile services, but since they won’t have that until next year they have to compete purely on price, and that’s a disadvantage, he said. Interkom began offering long-distance services in May, five months after Otelo Communications GmbH, Mannesmann Arcor and several others entered the deregulated market to compete against Deutsche Telekom AG . Interkom, a venture of Viag and British Telecommunications Plc, plans to start up a mobile network next year and offer a single bill for wireless and standard phone services. The news is a further embarrassment for BT which reveals its results this week and has struggled to produce a convincing international strategy while its domestic market faces growing competition.
