Backman
31-10-2005, 06:18 AM
Telefonica SA (TEF.MC: Quote, Profile, Research) is in talks to buy cellphone operator O2 PLC (OOM.L: Quote, Profile, Research) in a potential deal that could be valued at roughly 18 billion pounds, the Wall Street Journal reported, citing people familiar with the matter.
The talks are part of the Spanish telecommunications company's efforts to expand in Europe after years of building its business in Latin America.
The companies could announce a deal as soon as this week, the paper said, citing sources who also cautioned the talks remain at a fragile stage and could still fall apart.
Possible terms of a deal could not be determined. Telefonica declined to comment; officials from O2 didn't return calls, the paper said.
Madrid-based Telefonica, which is the world's fifth-largest telecommunications company by market value, has been looking for an acquisition in Europe, where the telecommunications industry has been on a M&A spree in the past year.
Telefonica recently approached KPN NV (KPN.AS: Quote, Profile, Research) of the Netherlands over whether the companies should begin merger negotiations. But KPN was cool to the overture and no talks ensued, the paper said, citing unnamed sources.
The Spanish company then focussed on O2, which was spun out of BT Group Plc (BT.L: Quote, Profile, Research) in 2001. Based in Slough, O2 has 15,000 employees and 24.6 million mobile-phone customers in Britain, Ireland and Germany.
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The talks are part of the Spanish telecommunications company's efforts to expand in Europe after years of building its business in Latin America.
The companies could announce a deal as soon as this week, the paper said, citing sources who also cautioned the talks remain at a fragile stage and could still fall apart.
Possible terms of a deal could not be determined. Telefonica declined to comment; officials from O2 didn't return calls, the paper said.
Madrid-based Telefonica, which is the world's fifth-largest telecommunications company by market value, has been looking for an acquisition in Europe, where the telecommunications industry has been on a M&A spree in the past year.
Telefonica recently approached KPN NV (KPN.AS: Quote, Profile, Research) of the Netherlands over whether the companies should begin merger negotiations. But KPN was cool to the overture and no talks ensued, the paper said, citing unnamed sources.
The Spanish company then focussed on O2, which was spun out of BT Group Plc (BT.L: Quote, Profile, Research) in 2001. Based in Slough, O2 has 15,000 employees and 24.6 million mobile-phone customers in Britain, Ireland and Germany.
Read more