Deutsche Telekom and France Telecom have signed contracts to
set up a 50:50joint venturethat combines their UK operations,
T-Mobile and Orange.
Regulators must still approve the deal, which will give the new
company some 28.4 million subscribers, or an estimated 37% of the
UK mobile telephony market, eclipsing O2's 27%.
The business will have a pro forma revenue of around £7.7bn and
earnings before interest, tax, depreciation and amortisation of
£1.7bn. The merger is expected to save £3.5bn.
Spokesmen for the two companies stressed the long-term
cooperation required to make a success of the deal. Deutsche
Telekom CFO Timotheus Höttges said the deal was based on the "full
commitment of Deutsche Telekom and France Telecom to a long-term
partnership".
Gervais Pellissier, deputy CEO of France Telecom's group finance
and information systems, stressed the "excellent cooperation"
between the two firms. "I am certain that this spirit of
professionalism and partnership will shape the future of our joint
venture," he said.