A new report out of Germany says that Deutsche Telecom will be acquiring 7,700 mobile tower sites from Telefonica Deutschland, owners of O2 brand in Germany. Telefonica is working towards finalizing the integration of E-Plus, which it acquired last year from KPN as part of a $4.7 billion all-stock deal. The deal, struck last September, made Telefonica the largest carrier in Germany, with over 42 million subscribers, which accounts for around 37 percent share of the German wireless market. Deutsche Telekom sits at number two and is Telefonica’s largest rival with 35 percent share of the market, while Vodafone Germany has 28 percent market share.
According to a press release by Telefonica, the base stations being transferred are mostly rooftop sites which would have otherwise needed substantial investment and manpower to dismantle. Transferring them to Deutsche Telecom will reportedly allow Telefonica to save significantly on capital expenditure and allow the company to focus on its LTE network expansion plans. The Chief Technology Officer of Telefonica, Mr. Cayetano Carbajo Martn noted that this will be a more cost-effective way of offloading the sites rather than the laborious, capital intensive and time consuming option of having to dismantle each of them one at a time. While Telefonica will continue to have access to the sites in the near future, they will eventually be managed by Deutsche Funkturm, a company that employs over 700 staff and is in charge of planning, building and managing base stations for Germany’s wireless carriers.
In its press release, Telefonica also noted that even after the deal goes through, it will continue to operate its network from around 25,000 locations spread across Germany. As for the proposed deal, the modalities are said to have been already worked out between the two companies, who are now awaiting approval from the country’s telecom regulator. While each company released its own press release informing the media about the proposed deal, neither have divulged any financial details.
As for Deutsche Telecom, the company released its own separate press release, claiming the takeover will allow it to expand its network faster than it would have otherwise been possible for the company. Announcing the deal, Mr. Bruno Jacobfeuerborn, Head of Technology at Deutsche Telekom, said “With this acquisition of mobile network base stations, we can realize our expansion faster and our customers will benefit from the additional power of the Telekom network even sooner. The collaboration between Telef³nica and Telekom in the tower-business, i.e. the joint use of base stations, will also be intensified by this co-operation”.