Deutsche Telekom and France Telecom have inked the deal to merge their UK assets, T-Mobile UK and Orange, which combined will become the biggest carrier in the market.
The agreement comes two months after the original JV announcement, which is still pending regulatory approval.
Under the deal, Deutsche Telekom has tipped in T-Mobile UK on a cash-free, debt-free basis, including T-Mobile UK's 50% stake in its 3G network joint venture with Hutchison and gross tax losses carried forward of at least €1.6 billion. France Telecom offers the whole of Orange UK, including €1.39 billion of intra-group net debt.
The carriers have confirmed that they would maintain separate brands for the next 18 months and then agree with shareholders on the next branding stage.
Meanwhile, Orange UK announced that ex-02 executive Martin Stiven has been appointed new VP of business, working closely with CEO, Tom Alexander, on development of the Orange brand.
T-Mobile has had a rough quarter with profits falling 30.8% year on year to €447 million in Q3. In the last year its customer base has shrunk by 1.2% to 16.6 million. The UK arm represented the only mobile company in Deutsche Telekom’s European fold to post negative customer growth.
The fortunes of Deutsche Telekom’s US arm T-Mobile, have also been fading as it also shed 77,000 mobile customers in the last quarter.