BT should buy O2 not EE, say industry experts

Following the news that BT is set to acquire one of the mobile industry’s biggest companies, analysts have had their say as to which would be the best fit.

According to the Wall Street Journal, which has been surveying a number of industry experts over the past few days, the consensus is that O2 would be the most suitable purchase.

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It has emerged that the British telecoms giant is also in takeover talks with EE.

Despite EE having three million more subscribers and 130 million more shops than O2 and possessing a higher valuation - $16 billion against O2’s $14 billion – there are a number of factors that are causing BT to favour the latter firm.

Steve Clayton, analyst at Hargreaves Lansdown, explained that the fact BT previously owned O2 is a major factor.

"BT is likely to feel that O2 is the more natural asset to own, having owned it previously," he said.

The two companies also collaborate in leasing fixed-line and mobile infrastructure, and nearly a third of O2 customers already source their home broadband from BT.

On the surface, therefore, the purchase of EE would be a much more complicated process than acquiring O2. However, a number of analysts have indicated that BT also has a partnership in place with EE, albeit not as longstanding as the one in place with O2. 760,000 of EE’s broadband customers currently use BT’s infrastructure, and the BT is set to utilise EE’s 4G mobile data network from 2015.

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Overall, it seems that while O2 would be the better, and certainly simpler, purchase for BT to make, the acquisition of EE would also make plenty of sense from a business point-of-view.