Orange “uninterested” in T-Mobile

Reports today claim Orange is involved in talks with Deutsche Telekom about a takeover of its T-Mobile UK network operation.

But Orange said it was unaware of any negotiations, and restated comments made last month to Reuters by Gervais Pellissier, chief financial officer of parent France Telecom, that it is uninterested in T-Mobile UK.

Orange earlier this month denied its parent France Telecom had already entered a bid with Berlin. However new reports quoting City sources claim it is far down the line with negotiations over a joint-venture with T-Mobile UK, that could see Deutsche Telekom retain a minor, ongoing interest in the UK market.

Yesterday, The Financial Times claimed Vodafone was poised to bid for T-Mobile’s ailing UK unit, sparking a remarkable unchecked flurry of coverage.

Vodafone has refused to comment.

Today, The Times claimed Vodafone was attempting to gatecrash existing discussions between Deutsche Telekom and France Telecom.

T-Mobile is valued at around £3.4 billion by its parent. However, Deutsche Telekom is not expected to be rushed into a deal, and has just appointed former Orange Romania chief executive Richard Moat to its UK business.

Moat will be given 12 months to right the business, unless T-Mobile UK draws very good offers.

Vodafone is number two and Orange is number three in the UK for customer numbers, with 25 and 21 per cent respectively, behind O2 with 27 per cent. T-Mobile is number four, with around a 15 per cent share.

Any sale of T-Mobile UK would be closely scrutinised according to competition rules by UK and European regulators, although there is already a precedent in France, Spain and Italy of the number one network taking a 40 per cent market share.

Analysts said any acquisition or merger would enable significant economies of scale to the purchaser, and also take out a powerful competitor in a closely-fought market.