T-Mobile offers EUR1.3 billion for tele.ring

2 Aug 2005

Deutsche Telekom’s wireless division T-Mobile has launched a EUR1.3 billion (USD1.6 billion) takeover bid for Austrian fixed and mobile operator tele.ring, eclipsing earlier offers from US venture capital fund Permira, German utility and rival Austrian carrier E.ON, and Dutch incumbent KPN. The supervisory boards of Deutsche Telekom and T-Mobile will meet on Thursday to discuss the offer, with many onlookers now convinced that the German powerhouse will emerge successful in the battle for control of the cellco.

Tele.ring has been put up for sale by Western Wireless which was itself recently bought by Alltel Corp of the US. Acquiring tele.ring would bolster T-Mobile’s presence in the Austrian cellular market and increase its market share in a crowded market, which also includes E.ON’s One and newcomer Hutchison 3 Austria. At the end of June T-Mobile claimed around 2.06 million Austrian subscribers, compared with 1.08 million for tele.ring. It currently lags well behind market leader Mobilkom Austria, which boasted more than 3.3 million clients at the same date, but purchasing tele.ring would lift T-Mobile’s share of the market from 25% to 36% in one fell swoop.

Austria, tele.ring