DT, Orange revive EE sale talks — report

DT, Orange revive EE sale talks — report

17 OCT 2014

Deutsche Telekom and Orange have reportedly resumed talks about the possibility of selling their EE joint venture, the largest mobile operator in the UK.

According to sources, an IPO is believed to be the most likely option, although divesting the business to a financial investor or another operator is also believed to be possible. Neither Deutsche Telekom nor Orange is believed to be interested in buying the other out.

A deadline for a decision has not been set by either owner.

Bloomberg values the company at around €15 billion, based on its 2013 earnings and a multiple of 7.1 times for announced wireless deals this year.

The formation of EE came after the two telecoms groups combined their UK assets to generate network and purchasing savings in 2010.

There has been speculation for some time about when the companies might look to cash in on the strategy, with an IPO plan called off earlier this year, following a strategic review.

One source said Orange would be willing to sell its stake in EE is it finds another viable M&A project, while Deutsche Telekom could use any proceeds from the sale of its holding to invest in its other businesses in Europe or even the US.

Earlier this week, DT turned down an offer from French player Iliad for its T-Mobile US operation, meaning it will have to continue to fund the business.

EE had a total of 30.8 million connections as of 31 June, down 0.8 per cent from 12 months previously. It claimed the best quarterly 4G performance ever recorded by a European operator with 1.3 million new LTE customers during Q2.

The operator announced recently that it was entering the quadplay market by adding a TV service to its offering. It also outlined its ambitions to make London’s Wembley the best connected stadium in the world by 2015, with plans to dramatically boost 3G and 4G capacity.

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Tim Ferguson

Tim joined Mobile World Live in August 2011 and works across all channels, with a particular focus on apps. He came to the GSMA with five years of tech journalism experience, having started his career as a reporter... More

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