Vodafone has announced that it will be selling off its Dutch fixed-line operations to T-Mobile Netherlands with the hope of winning over European regulators to sign off on its merger with Liberty Global in the US.
The company's shares saw a slight downturn after the announcement, though the deal has not yet been finalised and will need to be approved by both the Dutch competition authority and the European Commission in order to close. Vodafone though believes that it will obtain the necessary approval and that the deal will be finished by December.
The company's announcement is centred around its merger deal with the US cable operator Liberty Global. The proposed merger would see Vodafone's mobile business in the country combined with that of Liberty's subsidiary Ziggo that operates a television, broadband and fixed-line network in the Netherlands. If Vodafone and Ziggo were to merge, it would create a quad-play operator that would be able to compete with the former state run telecommunications company KPN.
When the deal between the two companies was first announced in May of this year, Vodafone's chief executive Vittorio Colao highlighted the ways in which the combined companies would benefit the Netherlands, saying: “The combination of Vodafone's leading mobile business with Ziggo's successful broadband and TV business creates a strong and competitive integrated communications player, which will invest in digital infrastructure, entertainment services and productivity applications for Dutch consumer, business and public sector customers."
If the merger of Vodafone and Ziggo in the Netherlands were to be approved, it would create a combined company worth around €3.5 billion after integration costs.
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