Partner, Cellcom Rise on Wholesale Market Bets: Tel Aviv Mover
Shares of Partner, Israel’s second-largest mobile carrier, advanced 2 percent to 23.74 shekels, the highest since May 21, at 3:45 p.m. in Tel Aviv. The Rosh Ha’Ayin, Israel-based company was the second-biggest gainer on the benchmark TA-25 Index (TA-25), which added 0.2 percent. Cellcom rose 1.3 percent to 33.25 shekels.
The government, keen to introduce competition in the fixed-line calling, Internet and television markets served by Bezeq The Israeli Telecommunication Corp. (BEZQ) and Hot Telecommunication System Ltd., is seeking to create a wholesale market in which bulk network capacity is sold to telecommunication providers such as Partner and Cellcom for resale to customers. Israel’s Ministry of Communications yesterday issued a list of services the fixed-line incumbents must offer to wholesale market buyers.
“The wholesale market initiative is gaining momentum,” Gil Dattner, an analyst at Bank Leumi Le-Israel Ltd. (LUMI) in Tel Aviv, said today by phone. “The market is reacting to signs from the ministry that it will encourage the cellular companies to invest more in the wholesale market, allowing them to compete in a more sophisticated way.”
The shares of Partner and Cellcom were among the worst performers on the benchmark gauge last year as new wireless operators, including a Hot unit and Golan Telecom Ltd., entered the market in May 2012.
Partner, which saw revenue drop 27 percent in the first quarter of the year, is cutting jobs and seeking to enter other segments to boost revenue, Chief Executive Officer Haim Romano said Aug. 14.
Cellcom’s first-quarter sales dropped 21 percent from a year earlier, while net income declined 61 percent.
Bezeq shares (CEL) slid 0.6 percent to 4.67 shekels.
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