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Orange & T-Mobile Merger Finalised

Gordon Kelly


It's happening folks...

Deutsche Telekom and France Telecom late last week confirmed they have signed the final agreement to combine their UK operations, T-Mobile and Orange, into a 50:50 joint venture company. Due diligence has been completed and the terms of the transaction are now binding with formal completion expected in the first half of 2010 (video from the day of the original announcement).

"This joint venture is based on the full commitment of Deutsche Telekom and France Telecom to a long term partnership," said Deutsche Telekom CFO Timotheus Höttges. "The negotiations were conducted in a fair way on both sides and I am certain that this spirit of professionalism and partnership will shape the future of our joint venture. It will set new standards as the number one in the UK mobile market."

'Standards' is a word rival networks would debate, but what looks certain is we will have a new giant upon our hands with 28.4m customers and 37 per cent UK market share. Current leaders Vodafone and O2 have 24.7 per cent and 27.7 per cent respectively with 3 backing up the rear at eight per cent. Of course the deal can still be stopped should the Competition Commission decide to kick up a fuss, but given T-Mobile's May declaration that it wanted to merge or sell I suspect little will stand in its way.

How will O2 and Vodafone respond? My guess is by fighting over 3...


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