French incumbent Orange has reportedly agreed to transfer some of its Spanish network assets to smaller local carriers Yoigo or MasMovil. The move would be part of a a bid to gain EU approval of its €3.4bn (US$3.6bn) takeover of Spanish…
French incumbent Orange has reportedly agreed to transfer some of its Spanish network assets to smaller local carriers Yoigo or MasMovil. The move would be part of a a bid to gain EU approval of its €3.4bn (US$3.6bn) takeover of Spanish fixed-line operator Jazztel.
According to Spanish daily El Economista, Orange offered to divest assets to a smaller Spanish operator during a hearing in Brussels attended by EU officials and national competition authorities in France, Spain, Italy, Britain and Romania, along with Vodafone, Yoigo and MasMovil executives.
Yoigo declined to comment, while MasMovil did not respond to a request for comment.
The EU competition authority, which was due to decide on the deal by 30 April, has suspended its in-depth investigation of the deal twice so far.
Earlier in March, the regulator said that Orange had submitted commitments without elaborating further.
An analyst who does not wish to be named said that remedies might include network divestments, “appealing” wholesale agreements or a combination of both.
He noted that Orange does not have a big fibre footprint. However, it would make sense for troubled Yoigo, which is majority-owned by Swedish telco TeliaSonera, to acquire the fixed-line assets to complement its mobile-only offering . A deal with Orange would also make it less likely to be acquired by its rivals.
In the last few years, the carrier, whose ambitions to become a Spanish mobile maverick were overshadowed by Jazztel, has struggled to cope in the highly-competitive local market.
Yoigo’s parent company had tried to sell it in 2012, but the sale process was later called off as bidders were unwilling to match its €1bn (US$1.4bn) valuation.
Last summer, TeliaSonera CEO Johann Dennelind described the budget mobile operator as a sub-scale business with 7% market share. “Consequently, we are reviewing our future presence in the Spanish market,” he said at the time.
Orange, Vodafone and Jazztel have been long-rumoured as the most likely buyers for the asset.
MVNO MasMovil, which was founded in 2006 by Norwegian Christian Nyborg and Austrian Meinrad Spenger, operates over Orange network. The company, which claims to have over 130,000 customers, merged with Spanish enterprise telco Ibercom in 2014. It is listed on the alternative investment segment of the Madrid stock exchange.
