Merger clearance: Important milestone for Telefónica Deutschland

-Building a leading digital telco to compete
-Focus on mobile data with great customer experience
-Expected synergies of more than 5 billion Euros
MUNICH. Telefónica Deutschland has received the EU Commission’s conditional clearance to acquire the E-Plus Group from the Dutch telecommunication corporation KPN. After the fulfilment of the conditions Telefónica Deutschland will be able to go ahead to form a leading digital telecommunication provider in Germany with a strong focus on the mobile data business.
„We have now reached the most important milestone on our way to close the transaction”, says Markus Haas, CSO Telefónica Deutschland Holding AG. “We welcome the decision by the European Commission. It underpins consolidation opportunities in Europe, fostering investments and mobile data business.” „The new company will gain significant scale and efficiency benefits which will enable us to challenge the market with innovative products and services with great customer experience“, says Rachel Empey, CFO Telefónica Deutschland Holding AG. „Combining the strengths of both companies we will be able to offer a broader, deeper and faster mobile data experience, providing significant benefits for our customers.” In the course of the merger clearance process, Telefónica Deutschland has agreed a set of remedies which fully address the EU commission’s competition concerns. In this regard, Telefónica has committed to sell upfront 20 percent of its mobile network capacity via Bitstream Access to an MVNO and give the opportunity to acquire up to 10 percent additional network capacity. Bitstream Access is a product where the MNO provides network capacity in the form of data throughput and data volume. This enables an MVNO to offer its own mobile services to customers. Telefónica Deutschland has already signed a corresponding contract with Drillisch. This will become effective when the European Commission confirms that the agreement with Drillisch complies with the conditions and obligations attached to the approval of the transaction. Furthermore, to enable a potential entry into the German market, Telefónica will make available to an interested party a package of 2.1 and 2.6. GHz frequencies, mobile sites, national roaming and a passive site sharing. In addition, existing contracts with wholesale partners will be extended until 2025 and the transition to a different guest network operator will be facilitated. Telefónica Deutschland will continue to focus on its mobile data strategy and confirms the expected synergies from the transaction of more than 5 billion Euro (net present value). The company remains confident in closing the acquisition of E-plus during the 3rd quarter of 2014.
Telefónica Deutschland Holding AG, listed at the Frankfurt Stock Exchange in the Prime Standard, and its wholly-owned, operationally active subsidiary Telefónica Germany GmbH & Co. OHG is part of the Spanish telecommunication group Telefónica S.A. headquartered in Madrid. The company offers its German private and business customers post-paid and prepaid mobile telecom products as well as innovative mobile data services based on the GPRS, UMTS and LTE technologies with its product brand O2. In addition, the integrated communications provider also offers DSL fixed network telephony and high-speed Internet. With a significant presence in 24 countries and a customer base of more than 313 million accesses, Telefónica is one of the largest telecommunications companies around the world.