E-Plus Deal Approval May Spark More M&A, Change of KPN Ownership
2014-07-01 15:28:34.506 GMT
By Sam Chambers
July 1 (Bloomberg) -- The EU is set to rule on Telefonica’s
proposed $12b purchase of KPN’s German unit E-Plus by July 10.
Telefonica’s recent agreement to cede spectrum to Drillisch is
seen as having increased chances of deal approval. Deal
implications outlined below:
POSITIVE CATALYST:
* Deal approval would boost investment case of the sector by
providing greater regulatory visibility, help stabilize
prices, Macquarie says
* NOTE: Since 2005, European wireless avg. rev. per user
has fallen by 53% to EU12: Bloomberg Industries data
* Deal approval could trigger M&A activity in the Netherlands
and Belgium, two of KPN’s other mkts: ING
* Approval opens the door to in-market consolidation in Italy
and Spain: Macquarie
* Positive E-Plus ruling could pave the way for Tele2 to sell
its Dutch and Norwegian operations: JPMorgan
AMX STAKE SALE:
* MergerMarket reported that America Movil, KPN’s largest
shareholder, will reevaluate its holding after E-Plus
outcome is known
* On June 28, Carlos Slim agreed to buy AT&T’s stake in AMX
for $5.57b, a move Macquarie said may lead to AMX selling
its KPN stake
* NOTE: AMX has cut its KPN holding by ~17% since Aug.:
Bloomberg data
RECENT EXAMPLES
* The EU has approved in-market consolidation in Austria and
Ireland, after imposing remedies:
* In May, EU approved Hutchison’s acquisition of TEF’s Irish
unit on condition it ceded up to 30% of its spectrum to at
least one virtual network operator
* When approving Hutchison’s purchase of Orange Austria in
2012, the EU unsuccessfully tried to secure a new entrant
into the mkt
DEADLINE/TIMING:
* The EU has set a deadline of July 10 to rule on the deal; on
June 30 EU commissioner Almunia said a decision would be
reached in ’coming days’
* The European Commission is scheduled to meet on July 1 and
July 8
For Related News and Information:
First Word scrolling panel: FIRST<GO>
First Word newswire: NH BFW<GO>
To contact the reporter on this story:
Sam Chambers in London at +44-20-7673-2021 or
schambers7@bloomberg.net
To contact the editors responsible for this story:
James Ludden at +44-20-7673-2645 or
jludden@bloomberg.net
Gaurav Panchal
2014-07-01 15:28:34.506 GMT
By Sam Chambers
July 1 (Bloomberg) -- The EU is set to rule on Telefonica’s
proposed $12b purchase of KPN’s German unit E-Plus by July 10.
Telefonica’s recent agreement to cede spectrum to Drillisch is
seen as having increased chances of deal approval. Deal
implications outlined below:
POSITIVE CATALYST:
* Deal approval would boost investment case of the sector by
providing greater regulatory visibility, help stabilize
prices, Macquarie says
* NOTE: Since 2005, European wireless avg. rev. per user
has fallen by 53% to EU12: Bloomberg Industries data
* Deal approval could trigger M&A activity in the Netherlands
and Belgium, two of KPN’s other mkts: ING
* Approval opens the door to in-market consolidation in Italy
and Spain: Macquarie
* Positive E-Plus ruling could pave the way for Tele2 to sell
its Dutch and Norwegian operations: JPMorgan
AMX STAKE SALE:
* MergerMarket reported that America Movil, KPN’s largest
shareholder, will reevaluate its holding after E-Plus
outcome is known
* On June 28, Carlos Slim agreed to buy AT&T’s stake in AMX
for $5.57b, a move Macquarie said may lead to AMX selling
its KPN stake
* NOTE: AMX has cut its KPN holding by ~17% since Aug.:
Bloomberg data
RECENT EXAMPLES
* The EU has approved in-market consolidation in Austria and
Ireland, after imposing remedies:
* In May, EU approved Hutchison’s acquisition of TEF’s Irish
unit on condition it ceded up to 30% of its spectrum to at
least one virtual network operator
* When approving Hutchison’s purchase of Orange Austria in
2012, the EU unsuccessfully tried to secure a new entrant
into the mkt
DEADLINE/TIMING:
* The EU has set a deadline of July 10 to rule on the deal; on
June 30 EU commissioner Almunia said a decision would be
reached in ’coming days’
* The European Commission is scheduled to meet on July 1 and
July 8
For Related News and Information:
First Word scrolling panel: FIRST<GO>
First Word newswire: NH BFW<GO>
To contact the reporter on this story:
Sam Chambers in London at +44-20-7673-2021 or
schambers7@bloomberg.net
To contact the editors responsible for this story:
James Ludden at +44-20-7673-2645 or
jludden@bloomberg.net
Gaurav Panchal