Telefonica is to start talking again with KPN about how the two operators can combine to save costs in the German market, said the Financial Times.
The Spanish operator wants to study network sharing between O2 Germany and KPN’s E-Plus, which are the fourth and third largest operators in the country respectively.
The two sides will meet to discuss network sharing in more detail, but not until after KPN has completed a proposed EUR3 billion rights issue, which is expected to take place after the Dutch operator publishes its results on 23 April, according to the report.
Talks about a full merger between O2 and E-Plus failed last summer with the blame falling on adverse conditions in the financial markets. Instead Telefonica floated a partial stake in its German unit later in 2012.
The current talks appear to be less ambitious in their scope. Nevertheless, they still have the potential to deliver cost savings for Telefonica, a key objective for the debt-laden group.
The company is looking at other debt-cutting measures, including a possible IPO in Colombia and the sale of its Irish and Czech units.
Signs of the company’s attitude to the Czech market emerged in comments made by the CEO of its local unit who pronounced himself “really disappointed” with the rule changes proposed by the country’s regulator for a spectrum auction.
“We’re still under consultancy, so we will give our feedback to the regulator, but this is so far away from what we expected,” said Luis Malvido in remarks reported by Bloomberg.
“We’ve been very surprised and this is damaging our business case with our intention to continue investing,” he added. Telefonica is the second largest operator in the country.
The Czech regulator this week proposed new auction terms, including allocation of two blocks of spectrum in the 800 MHz band for a new entrant.