Telefónica to bid for mmO2?

15 Nov 2004

Rumours are rife that Spanish telco Telefónica is actively considering a takeover move for mmO2, the former mobile arm of the UK’s BT Group. Although neither company has commented on the exact nature of the talks held in October between Telefónica chairman Cesar Alierta and mmO2 chief executive Peter Erskine, sections of the analyst community are predicting that the Spanish company will table an offer in the New Year as it tries to enhance its position as one of the world’s leading integrated service providers. Mr Alierta is keen to increase Telefónica’s global fixed line and mobile subscriber base by around 50 million to 170 million over the next three years in a bid to challenge the might of the UK’s Vodafone Group. A move for mmO2 would add more than 20 million mobile customers in the UK, Ireland and Germany to the 55 million already connected to the numerous overseas subsidiaries of Telefónica Moviles, the Spanish group’s mobile arm.