Vodafone, DT tussle for O2 Netherlands – report

Game on

Vodafone and Deutsche Telekom are poring over the accounts of O2 Netherlands, with a view to buying the mobile phone network, according to a Dutch financial newspaper.

O2 Nederland, a subsidiary of UK-based mm02 PLC, has annual sales of €320m and is worth c€200m, according to FEM/de Week, by way of Bloomberg. But a bidding battle could talk up prices nicely.

Deutsche Telekom has perhaps the greater need, as O2's customer as would establish it in clear third place in the Dutch market, ahead of Dutchtone, owned by Orange. However, all of the existing operators will benefit if O2 Nederland is taken out. Maybe, they will see less need to collude in price-fixing in future.

The Netherlands has five mobile networks, which is an awful lot for a country of 16 million or so. Traditional incumbent KPN Mobile is comfortably the market leader and Vodafone is in second place, although it would be nip and tuck with KPN if it nabbed O2.

mm02 is perhaps already semi-detached from the Dutch market, signing a deal in April 2002 to outsource its entire mobile network in the country to Ericsson. It is doubtful if this arrangement would survive a change of ownership too long.

mm02 also operates in the UK, where it is the smallest mobile network of four, and which is thought by many, to be the most vulnerable to the impending arrival of Hutchison 3G as the country's fifth operator. 02 has country ops in Germany and Ireland too. ®

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