Deutsche Telekom and Tele2 Agree to Merge Dutch Operations; Sceptical of Regulatory Approval
On Dec. 15, Deutsche Telekom and Tele2 announced that they had agreed to merge their Dutch operations. We think this deal makes a lot of sense, as we’ve always been sceptical of Tele2’s ability to earn a decent return on its capital in the Netherlands, due to its small size. The combined firm would have enlarged scale that should help it compete more effectively against KPN and Vodafone Ziggo.Tele2 entered the Dutch market due to government incentives, including selling spectrum at a lower pric...
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