Vodafone Could Swap Turkish Telco For T-Mobile UK

A deal for Vodafone to acquire T-Mobile UK is inching closer to get materialised as early as next month, with the telecom watchdog Ofcom asserting that it didn't see the need to have a review of the competition situation in the UK.

Vodafone has already proposed the option of offering its Turkish operations in-part exchange for T-Mobile UK, which is currently owned by Germany's Deutsche Telecom - a move that would help the UK operator to restructure its operations.

In spite of the fact that Vodafone continuously cited developing economies as hub for its growth opportunities, the operator seems to be considering pull out from Turkey to have a firm hold in the UK's market, according to the reports.

Vodafone took over Turkish operator Telsim back in 2005 for $4.55 billion, but immediately had to pour in over $1 billion to upgrade its networks and invested massively to retain the second spot in the market.

If the deal goes through, Vodafone would surpass existing market leader O2 to become the UK's biggest mobile operator. As of now, Vodafone is at the second spot with around 25 percent market holdings, leapfrogged by O2, which has 27 percent stake, and the acquisition of T-Mobile by Vodafone will raise its share up to 40 percent.

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Our Comments

There are chances that this deal could fall through at the last moment because of the current economic conditions. It s also very unlikely that T-Mobile would want to swap its UK market share for one in Turkey, especially as this is still a challenging environment.

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