Telefonica Deutschland (O2) has signed a network access agreement with local MVNO Drillisch in an effort to persuade the European Commission (EC) to approve its planned €8.6bn (US$11.7bn) takeover of E-Plus.
The agreement would see Drillisch gain…
Telefonica Deutschland (O2) has signed a network access agreement with local MVNO Drillisch in an effort to persuade the European Commission (EC) to approve its planned €8.6bn (US$11.7bn) takeover of E-Plus.
The agreement would see Drillisch gain access to 20% of the combined networks of O2 and E-Plus over a five-year period after the completion of the E-Plus takeover.
Telefonica’s German unit said Drillisch would also have the right to acquire up to 10% extra network capacity.
O2 said the agreement was entered into “with a view to the pending decision by the EC”, due by 10 July. It will only become effective if the commission clears the proposed merger.
Last week, it emerged that the EC was expected to clear the deal, which reduces Germany’s number of mobile network operators from four to three, provided local MVNOs can lease at least a fifth of O2 and E-Plus’ combined spectrum.
However, the vast majority of national competition regulators reportedly did not vote in favour of suggested remedies for the takeover at a recent meeting. Just two of the regulators – from Belgium and Sweden – voted in favour, five voted against and five abstained, according to the Financial Times report citing two officials involved in the meeting.
The vote is not binding for the EC, but it may prompt it to re-evaluate the remedies. Typically, however, an absolute majority must vote against a proposal for their stance to be formerly considered.
Last month, the EC cleared the takeover by Hong Kong-based Hutchison of O2 Ireland. Approval of that four-to-three deal requires Hutchison to pave the way for two new Irish MVNOs and continue its network-sharing deal with incumbent Eircom.
