BRUSSELS-The European Commission has approved the formation of two joint ventures by the German energy company Veba AG and London-based Cable & Wireless plc.
The two entities have created Vebacom GmbH, through which both groups will develop their telecommunications business in Germany. Veba will own 55 percent of Vebacom, Cable & Wireless will hold 45 percent.
The duo also are forming Cable & Wireless Europe, which will manage existing operations and develop new business in Switzerland and the European Union, excluding Germany and the United Kingdom.
The commission said it finds no competition problems with the ventures, noting that the two companies don’t have activities that significantly overlap. In fact, the joint venture will provide a potentially strong competitor for the existing national monopoly telecommunications provider, the commission stated.
Through liberalization, Vebacom will eventually be able to provide public service network operations and compete with Deutsche Telekom. In Germany, full liberalization is expected by 1998.
Veba will have managing control of Vebacom; Cable & Wireless will have managing control of Cable & Wireless Europe.
