MADRID/MUNICH (dpa-AFX) – The Spanish telecommunications group Telefónica ( Telefonica ) wants to completely take over its German subsidiary, known under the brand name O2. On Tuesday, the company surprisingly announced a purchase offer that would concern up to 28.19 percent of the share capital. Telefónica currently holds 71.81 percent of the shares. They want to concentrate on their core markets, where Germany represents one of the “most attractive and stable telecommunications markets in Europe”. According to its own statements, the bidder does not want to conclude a control or profit transfer agreement. Telefónica Deutschland is one of the three mobile phone network operators in this country; the major competitors are Deutsche Telekom (Deutsche Telekom) and Vodafone (Vodafone Group).
After the news became known, Telefonica Deutschland shares were initially suspended from trading. In the morning the notes jumped by around 40 percent to a price of around 2.35 euros. In doing so, they have almost completely made up for the crash at the beginning of August, when the announcement of a partnership between 1&1 and Vodafone raised concerns among Telefonica Deutschland shareholders about the future of the group.
As Telefónica Deutschland ( Telefonica Deutschland ) announced, the company’s board of directors and supervisory board are reviewing the offer documents and will then comment. The company has around 7,500 full-time positions, and in addition to the headquarters in Munich, the former E-Plus headquarters in Düsseldorf is a large company location. Germany boss Markus Haas viewed the Spanish mother’s plan as a “strong commitment”.
The Spaniards are unlikely to have any financing problems with the deal: ” Telefonica is currently sitting on seven billion euros gross cash on the balance sheet, which leaves plenty of scope for financing,” wrote analyst Akhil Dattani from JPMorgan in an initial assessment of the transaction.
The German subsidiary presented quarterly figures on Tuesday that were positive. In the third quarter, after deducting cancellations, the company gained around 400,000 mobile customers, around a third more than in the second quarter (around 300,000). It was the best value since the end of 2021. According to the information, sales rose by 2.2 percent to 2.1 billion euros in the third quarter, with the mobile phone service business being the growth driver. The result for the period – i.e. the net profit – increased by six percent to 41 million euros.
The competition has not yet published any figures for the past quarter; in the period before that there was a neck-and-neck race between Telekom and O2. Vodafone, on the other hand, had lost significant ground.
Mobile communications are O2’s core business, the landline network plays more of a secondary role – here the company does not rely on its own lines, but has rented capacity from other companies. One reason for the increasing number of customers was probably a better price-performance ratio than a few years ago. At that time, the O2 network coverage was nowhere near as good as that of the competition. However, O2 largely made up for this shortfall with high investments. Company boss Markus Haas was satisfied: “After a strong third quarter, we are fully on track to achieve our goals for the 2023 financial year.”
Looking ahead, however, there is a dark cloud on O2’s horizon. Until now, the company has received part of its sales from its competitor 1&1, whose cell phone customers primarily use the O2 network. In the summer or fall of 2024, the United Internet subsidiary will gradually change gears and instead rely on a collaboration with Vodafone. As a result, O2 will gradually receive fewer rental payments from 1&1. According to analyst estimates, O2 has so far received around 500 million euros per year from its competitor from Montabaur./ngu/wdw/DP/ngu
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