Orange and MásMóvil present planned merger to European Commission

Christel Heydemann

Spanish telcos Orange and MásMóvil have formally informed the European Commission of their plan to merge. The EC now has until March 20 to allow the merger or open an investigation into the impact of the deal on local competition.

The merger between the two was announced in mid-2022 and is valued at €18.6 billion (an enterprise value of €7.8bn for Orange Spain and €10.9bn for MásMóvil). The two parties are hoping that the deal will be closed by the end of 2023.

The partners argue that the proposed merger will “create a sustainable player with the financial capacity and scale to continue investing to foster the future of infrastructure competition in Spain for the benefit of consumers and businesses”.

However the scale of the new operation may concern regulators. Pre-merger, the two companies are the second and fourth largest telcos in Spain. Afterwards they will be a strong number two to Telefonica, with Vodafone back in third. In recent months, the EC has not been shy to investigate mega-deals – such as the Viasat-Inmarsat merger and Microsoft’s takeover of Activision Blizzard. Reuters notes that the EC “has previously opposed deals that reduce the number of players from four to three in major markets”.

At the time of the merger announcement, Christel Heydemann, CEO of Orange, said: “I strongly believe that the creation of this new company is of fundamental importance for the Group, the Spanish telecoms market and for our customers.”