T-Mobile NL acquisition surprise quells panic mongering, says GlobalData

Following the news that private equity firm Apax Partners LLT and investor Warburg Pincus have agreed to acquire T-Mobile Netherlands Holding from Deutsche Telekom (which currently holds 75%) and Tele2 (currently 25%) for a transaction Enterprise Value of €5.1bn;

Emma Mohr-McClune, Service Director at GlobalData, a leading data and analytics company, offers her view:

“Firstly, rivals will no doubt be extremely relieved that India’s Reliance Industries – linked to one of the most innovative and aggressive mobile market entrant case studies in telecommunications history – has failed in its reported bid to enter the European market via this Dutch acquisition. A successful Reliance acquisition coup would have sent rival digitalization teams scurrying for cover, whereas Apax Partners and Warburg Pincus represent a far more familiar – and therefore competitively predictable – prospect.

“Although the deal still needs to move through all the usual regulatory hoops and approval processes, we see this as a good fit for Apax Partners and Warburg Pincus. T-Mobile NL has much in common with earlier-acquired, small market challenger acquisitions that these partners have worked on before, either separately or together.

“However, all of T-Mobile NL’s existing challenger references are on the mobile side, with much work to do to establish T-Mobile NL as a convergence player in the Netherlands. Its fixed-line customer base of 700,000 is tiny in comparison to better-established players KPN and VodafoneZiggo – and T-Mobile NL’s position on payTV is likely tiny. This makes us think that the consortium partners, should they be successful in this acquisition, could be considering further M&A as a short-cut to convergence strength.”

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