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Merger talks between Orange and Vodafone

Time and again, there are merger talks between the major telecommunications companies. However, the latest negotiations between Orange and Vodafone failed.

French government blocked merger

Over a period of six months, Orange and Vodafone negotiated a merger. The two companies have roughly equal economic strength and are among the market leaders in the telecommunications sector. Orange, formerly France Telecom, is particularly strong in France, some other European countries, including Belgium, Poland and Spain, in the Arab region and in Africa. Vodafone, on the other hand, is active not only in Europe but also in some African countries, including South Africa, and in the Middle East. Both companies are valued on the stock market at around 30 billion euros.

In addition to the overall merger, partial mergers were also considered, which would have been limited to certain geographical regions. The main reason for this was that the merger of the entire groups would have faced enormous technical and legal hurdles. The (partial) merger was ultimately prevented by the French government, which holds 23 percent of the shares in Orange.

Also merger efforts with Telekom

Prior to the negotiations with Vodafone, Orange also showed interest in a merger with Deutsche Telekom. This aspiration was particularly topical in 2014 to 2016, when both groups were valued roughly the same on the stock market. Today, the share prices differ too greatly for a merger to take place on an equal footing.

Nevertheless, Deutsche Telekom is also open to mergers with other telecommunications groups. The main reason for this is seen in the expansion of market power: Telekom CEO Tim Höttges, for example, is actively seeking a merger with Telefonica or Orange to create a European counterweight to U.S. telephone groups. He is also insisting on an adjustment of the legal framework in this regard.

Merger generally sought

The now failed talks between Orange and Vodafone thus reflect a general development on the European telecommunications market: all leading groups are interested in mergers or at least in significantly intensified cooperation in order to remain competitive internationally.

Simon Lüthje

I am co-founder of this blog and am very interested in everything that has to do with technology, but I also like to play games. I was born in Hamburg, but now I live in Bad Segeberg.

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Time and again, there are merger talks between the major telecommunications companies. However, the latest negotiations between Orange and Vodafone failed. French government blocked merger Over a period of six months, Orange and Vodafone negotiated a merger. The two companies have roughly equal economic strength and are among the market leaders in the telecommunications sector. … (Weiterlesen...)

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