European Commission approves acquisition of Tele2 Netherlands
Nov 28, 2018
11-27-2018 Andreas Fuchs
Today the European Commission has approved the acquisition of Tele2 Netherlands by T-Mobile Netherlands without any conditions. The combined company will be in a better position to offer integrated packages of fixed and mobile telecommunication services to customers and step up the challenge for the dominant players in the Dutch market, KPN and VodafoneZiggo.
Søren Abildgaard, CEO of T-Mobile NL: "I am very pleased with the decision of the European Commission because it is the best outcome for Dutch consumers and businesses. We are committed to continue to disrupt the Dutch telecom market and this transaction will allow us to step up the challenge for KPN and VodafoneZiggo. Moreover, we can now start to implement the promises we made including an accelerated 5G launch, high speed internet in rural areas as well as contract freedom for new and existing customers with a combined contract of fixed and mobile services.“
Thorsten Langheim, designated member of Deutsche Telekom’s Board of Management responsible for USA and Group Development, commented: “I am pleased that the EC has acknowledged the specifics of the Dutch merger and therefore approved this transaction unconditionally. Following clearance of our UPC acquisition in Austria earlier this year, this is another important milestone in the strategic development of DT’s European Portfolio and more importantly our turnaround plan for T-Mobile NL. The enlarged T-Mobile is now in a strategically improved position to attack the two dominant players in the Dutch telco market and the increased scale improves our investment capabilities to sustain our network leadership and to build out next generation 5G and fiber networks.”
Closing of the transaction is scheduled for beginning of 2019. From this point in time onwards the financial results of Tele2 NL will be fully included in Deutsche Telekom Group’s consolidated financial statements.
The enlarged company will have pro-forma revenues in excess of EUR 2.0 billion (last twelve month as of Q3/2017) and around 4.3 million mobile postpaid subscribers and expects to generate annual run-rate synergies of around EUR 150 million p.a. within three years from closing. These synergies allow for disruptive customer propositions and sustainable investment to maintain network leadership.
Upon closing of the transaction, Tele2 will receive a stake of 25 percent in the enlarged company and a cash payment of EUR 190 million. Deutsche Telekom will own 75 percent of the company and a EUR 1.1 billion intercompany loan receivable.