EU approves Telefonica’s €8.6bn acquisition of E-Plus

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Takeover reduces the number of German mobile operators to three and creates the largest in the country with more than 44 million customers

The European Union (EU) has cleared Telefonica’s €8.6 billion (£6.84 billion) acquisition of German mobile operator E-Plus.

Combining the two firms will create the country’s largest mobile operator by customers. E-Plus has more than 25 million mobile subscribers, with Telefonica Germany accounting for 19.2 million. Merging the two will create a base of more almost 45 million mobile subscribers.

Deutsche Telekom is currently the largest German operator with 39.1 million customers, while Vodafone accounts for 32.3 million.

The takeover will therefore see the number of German mobile operators reduced from four to three and

In order for clearance of the deal to be granted, the EC insisted that Spanish-based Telefonica rent out up to 30 per cent of the merged company’s network capacity and divest some radio wave spectrum.

It will also extend existing wholesale agreements and offer 4G mobile broadband internet to any company that wants to offer the services. The EC said this would allow for up to three new MVNOs to be created.

European Competition Commissioner Joaquin Almunia said in a statement: “The remedies to which Telefonica commits ensure that the acquisition of E-Plus will not harm competition in the German telecoms market.”

In July 2013, Telefonica Germany announced its intention to acquire E-Plus, which has been owned by Dutch telecoms provider KPN since 2002. The deal was approved by KPN shareholders in Octiber, but has been held up due to concerns from the EC on reduced competition in the German mobile market.

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