OXFORD, United Kingdom-Following months of discrete negotiations about merging parts of their cellular operations, financial analysts have damned the proposed linkup between KPN and MmO2 as not providing the “magic solution” to KPN’s deteriorating share price.
Only days ago, broadsheet newspapers reported fresh talks between the two telecom firms focused on KPN purchasing O2 Germany, MmO2’s German unit. This follows ongoing speculation that MmO2 is looking to sell its troubled Dutch operation rather than its increasingly profitable German operation.
London-based industry watchers claimed KPN is looking to acquire elements of MmO2’s wireless subsidiaries to create a pan-European wireless operator that would be valued at 13 billion euros (US$14 billion). However, these analysts believe it would need more than a merger to improve the performance of KPN’s E-Plus German cellular firm and have suggested KPN should consider a relaunch of its i-mode service to provide a boost to subscriber growth. Other analysts claimed these negotiations will extend over many months and likely will come to nothing.
