EC authorises Orange’s €3.4 billion acquisition of Jazztel

The European Commission has authorised Orange’s €3.4 billion buyout of Jazztel, after Orange made a series of commitments, including agreeing to sell a fibre network representing 720,000 building units. 

Orange said it will temporarily provide the buyer of the network with a wholesale subscription offer to Jazztel’s ADSL network and, if necessary, will also provide a mobile wholesale offer if the buyer does not already have a 2G, 3G and 4G access.

“The proposed acquisition of Jazztel aims to give rise to the second-largest fixed broadband operator and one of the most dynamic players in the Spanish mobile market,” said Orange.

It said that the 720,000 building units are largely composed of “redundant connections between the existing networks of Orange and Jazztel” and that it not have to redeploy fibre in the divested areas.

Orange estimates that the Jazztel takeover will generate total synergies for the combined business of an estimated €1.3 billion, particularly through savings in operating costs and network investments.

Separately, Orange has plans to “significantly accelerate” fibre deployment in Spain in the coming years.

“By the end of 2016, more than 10 million Spanish building units will be able to benefit from Orange’s fibre offers,” said Orange.

Orange first made a €3.4 billion cash offer to buy 100% of Spanish telco Jazztel in September 2014 in an effort to establish itself as the second biggest fixed-line broadband operator in Spain.