UK telecommunications giant BT is in exclusive talks to buy the country's largest mobile group, EE, which includes not just the 4G EE network, but also the T-Mobile and Orange 3G brands.
EE is a joint venture between Deutsche Telekom and Orange, and controls around a third of the UK mobile market by revenue. However, the two companies that control it have reportedly been seeking a possible exit from the UK market, and confirmation that EE is now in exclusive discussions with BT indicates that they are keen to move forward with those plans.
A tentative proposal has been submitted by BT, valuing the potential acquisition at around £12.5bn. BBC News reports that the deal would see Deutsche Telekom take a 12% stake in BT, with Orange taking 4% of the British company.
Despite its massive presence in fixed line telephony and broadband, BT has no significant presence in the fast-growing mobile market. The company sold off its Cellnet mobile division over a decade ago; BT Cellnet was later rebranded O2, and acquired by Telefónica. BT had recently been considering buying O2 from the Spanish telecoms giant, before ultimately deciding to pursue an acquisition of EE instead.
However, given BT's domination of the UK fixed line market, and EE's leading position in the mobile market, it seems inevitable that communications regulator Ofcom will want to look into the deal before it gets the green light.
Source: Deutsche Telekom
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