Mannesmann in pounds 750m phones buy

GERMANY'S largest mobile phone group, Mannesmann, has bolstered its position in fixed-line communications with the pounds 750m acquisition of one of the country's largest long-distance carriers.

The purchase of the Otelo phone business from the German utility companies RWE and Veba will intensify the competition between Mannesmann, already one of the most formidable players in German telecoms, and the former state monopoly Deutsche Telekom, analysts said. Mannesmann overtook Deutsche Telekom as mobile phone market leader seven years ago, but it still lags behind the former monopoly in fixed-line communications.

Mannesmann announced late on Thursday evening that its Arcor unit was paying 2.25 billion deutsche marks (pounds 750m) for Otelo's fixed-line business. The deal includes Otelo's 400,000 customers, its 2,800 employees, its brand name and the on-line service germany.net. However, it excludes both Otelo's 60.25 per cent stake in the cellular business E-Plus and its cable unit, TeleColumbus.

"The network structure and customer bases of Arcor and Otelo complement each other well," Arcor said in a statement.

Veba said it would now focus its telecommunications activities on mobile services, and that E-Plus would reach profitability next year. Industry sources said Veba and RWE were considering using the Otelo proceeds to buy the 17 per cent E-Plus stake owned by the UK mobile group Vodafone.

The deal follows intense speculation about the future of Otelo, which was rumoured to have attracted a number of potential suitors.

Before Mannesmann's announcement on Thursday night, there had been widespread reports that the newly listed telecoms group Debitel was close to clinching a deal with Veba and RWE. Earlier, Mobilcom, another rising German carrier, said it had broke off talks with the two utilities.

The acquisition marks the second time Mannesmann has beaten German rivals in the race for a key domestic network. In 1996, it beat several bidders to a stake in the telecommunications network owned by the German railway. That gave Arcor the second largest fixed network in the country after Deutsche Telekom.

Start your day with The Independent, sign up for daily news emails
PROMOTED VIDEO
ebooks
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Tax Assistant

Negotiable: Recruitment Genius: A Tax Assistant is required to join a leading ...

Recruitment Genius: Outbound Sales Executive - OTE £25,000

£16000 - £25000 per annum: Recruitment Genius: This is an exciting opportunity...

Ashdown Group: Java Developer / J2EE Developer - Watford - £45,000 - £47,000

£45000 - £47000 per annum + bonus + benefits: Ashdown Group: Java Developer / ...

Ashdown Group: Marketing Product Manager - (Financial Services) - SW London

£35000 - £38000 per annum + Benefits: Ashdown Group: Marketing Manager - Marke...

Day In a Page

Iraq invasion 2003: The bloody warnings six wise men gave to Tony Blair as he prepared to launch poorly planned campaign

What the six wise men told Tony Blair

Months before the invasion of Iraq in 2003, experts sought to warn the PM about his plans. Here, four of them recall that day
25 years of The Independent on Sunday: The stories, the writers and the changes over the last quarter of a century

25 years of The Independent on Sunday

The stories, the writers and the changes over the last quarter of a century
Homeless Veterans appeal: 'Really caring is a dangerous emotion in this kind of work'

Homeless Veterans appeal

As head of The Soldiers' Charity, Martin Rutledge has to temper compassion with realism. He tells Chris Green how his Army career prepared him
Wu-Tang Clan and The Sexual Objects offer fans a chance to own the only copies of their latest albums

Smash hit go under the hammer

It's nice to pick up a new record once in a while, but the purchasers of two latest releases can go a step further - by buying the only copy
Geeks who rocked the world: Documentary looks back at origins of the computer-games industry

The geeks who rocked the world

A new documentary looks back at origins of the computer-games industry
Belle & Sebastian interview: Stuart Murdoch reveals how the band is taking a new direction

Belle & Sebastian is taking a new direction

Twenty years ago, Belle & Sebastian was a fey indie band from Glasgow. It still is – except today, as prime mover Stuart Murdoch admits, it has a global cult following, from Hollywood to South Korea
America: Land of the free, home of the political dynasty

America: Land of the free, home of the political dynasty

These days in the US things are pretty much stuck where they are, both in politics and society at large, says Rupert Cornwell
A graphic history of US civil rights – in comic book form

A graphic history of US civil rights – in comic book form

A veteran of the Fifties campaigns is inspiring a new generation of activists
Winston Churchill: the enigma of a British hero

Winston Churchill: the enigma of a British hero

A C Benson called him 'a horrid little fellow', George Orwell would have shot him, but what a giant he seems now, says DJ Taylor
Growing mussels: Precious freshwater shellfish are thriving in a unique green project

Growing mussels

Precious freshwater shellfish are thriving in a unique green project
Diana Krall: The jazz singer on being friends with Elton John, outer space and skiing in Dubai

Diana Krall interview

The jazz singer on being friends with Elton John, outer space and skiing in Dubai
Pinstriped for action: A glimpse of what the very rich man will be wearing this winter

Pinstriped for action

A glimpse of what the very rich man will be wearing this winter
Russell T Davies & Ben Cook: 'Our friendship flourished online. You can share some very revelatory moments at four in the morning…'

Russell T Davies & Ben Cook: How we met

'Our friendship flourished online. You can share some very revelatory moments at four in the morning…'
Bill Granger recipes: Our chef serves up his favourite Japanese dishes

Bill Granger's Japanese recipes

Stock up on mirin, soy and miso and you have the makings of everyday Japanese cuisine
Michael Calvin: How we need more Eric Cantonas to knock some sense into us

Michael Calvin's Last Word

How we need more Eric Cantonas to knock some sense into us