KPN still interested in mmO2 Germany, if the price is right

12 Sep 2003

Dutch telecoms group KPN has said that it remains interested in purchasing the German mobile unit of mmO2, but refuses to meet analysts’ expectations over price. KPN spokesman Marinus Potman claimed that their predicted price tag of between EUR1 billion and EUR2 billion did not take into account ‘as much as one billion euros in integration costs that would be required to combine things like technology standards and brands’. KPN currently owns Germany’s number three cellco E-Plus and has previously met with mmO2 about buying its fourth placed German operator, though Potman stressed that there have been no further talks in recent months, whilst mmO2 has made it clear that it would rather keep hold of the operator than sell it at a low price. KPN wants to combine the two cellcos to enable it to take on the dominance of T-Mobile and Vodafone in the German market.

Potman also used the opportunity to deny claims that KPN had been in talks with the Dutch government about the state’s 31% stake in the telco. There has been increasing speculation in the local media that the Dutch authorities will flood the market with KPN shares attempting to raise funds to plug its widening budget deficit.