Orange and T-Mobile to merge


Orange and T-Mobile to merge

Warwick Ashford

T-Mobile owner Deutsche Telekom and Orange owner France Telecom have confirmed they are to merge their UK operations.

The merger will form the UK's largest mobile operator, ousting Telefónica's O2 from the top spot, according to the Wall Street Journal.

The telcos said the merger and integration should generate estimated cost savings of more than €4bn for the company, which will have a 38% share of the UK market.

Although the savings enabled by the deal may be passed on to end-users, analysts have said the consolidation will mean reduced choice for users.

The T-Mobile and Orange brands will run separately for 18 months after completion of the transaction while a review of alternative brands is made, the companies said.

The board will be made up equally with representatives from the two with Orange UK chief executive Tom Alexander as CEO and T-Mobile UK CEO Richard Moat as chief operating officer.

O2 and Vodafone currently occupy the top two spots with 27.1% and 23.6% market shares respectively, according to research firm Gartner.

The deal will be reviewed by the UK Office of Fair Trade and possibly the European Commission.

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