Vodafone to Take Over T-Mobile UK

According to the latest news on the Web, wireless carrier Vodafone is considering making a bid for the T-Mobile UK business, Deutsche Telekom's subsidiary in the country. While Vodafone is considering the move as a possibility to consolidate its position in the UK market, Deutsche Telekom is reported to have appointed JP Morgan to advise on the actions it should take on its T-Mobile UK business.

Earlier reports also pointed towards a possible take over from Vodafone, while also stressing the fact that the carrier offered its Turkish business in an exchange deal for T-Mobile's UK division. T-Mobile accounts for an approximately 15-percent share of the market in the UK, and an acquisition would allow Vodafone to gain a 40-percent share, which would outpace rival operator O2.

At the moment, O2 has a 27-percent share of the UK mobile phone market, which is not that much compared with the shares of other companies in Europe. For example, Orange in France or Telefonica (O2) in Spain account for around 40 percent of the market in their countries, and they might not see with good eyes a deal with Vodafone.

According to the news site Mobile News, Deutsche Telekom's Chief Rene Obermann has seen a lot of pressure lately from the German government and Blackstone, a US private equity fund, to take a decision in what regards T-Mobile UK. The enterprise value of T-Mobile UK is estimated to be of between €3 billion and €4 billion (£2.6m-£3.4m).

T-Mobile UK, as many of you might already know, has had a rather difficult Q1 this year. The carrier has seen its revenues lowered by 21 percent, although it registered 53,000 net contract additions in the time frame. For the time being, neither T-Mobile UK, nor Vodafone commented on the rumors regarding the deal, though some official statements are expected to be made in the near future.