Telefónica Germany CEO rules out merger with E-Plus

Telefónica Germany CEO René Schuster said an imminent merger with rival operator E-Plus is not on the cards, adding that the operator is perfectly capable of winning further market share on its own.

Schuster

Speaking to German newspaper Handelsblatt, Schuster said there has been "no command from Spain" to go ahead with a merger. Telefónica and E-Plus parent KPN have several times discussed a merger of their respective German operations, but Handelsblatt noted that the most recent attempt failed last summer.

Schuster said such a merger would be "very complex." He added that many people do not understand the importance of investing money first in order to save money later.

'We do not necessarily have to merge," he added. "We are also still gaining market share...we are a German company, and if we believe that we have to merge, then we will propose it to our supervisory board and our majority shareholder, Telefónica."

Telefónica Germany, which sells services under the O2 brand, carried out an IPO last year but is still majority owned by Telefónica via Telefónica Germany Holdings Limited. The operator recently said high-speed data and converged service offerings would be key to driving renewed growth, after the company reported a decline in wireless service revenue and earnings in the first quarter due to "challenging market conditions."

For more:
- see this Handelsblatt article (translated by Google Translate)
- see this Telecompaper article

Related Articles:
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O2 Germany's IPO boosted by 3-year tax holiday
Telefónica on track with European revamp, claims COO
Telefónica Europe's Q1 results highlight data growth, but Spain struggles
Vodafone Germany to cut 500 jobs as competition bites
KPN CEO pushes for network sharing with O2 Germany

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