Brussels, 7 March 2002
Commission clears KPN's acquisition of sole control over E-Plus
The European Commission has cleared the proposed acquisition by Dutch telecommunications operator KPN of sole control over Germany's third largest mobile phone operator E-Plus. The Commission has found that the transaction would not raise any competition concerns in either the German or Dutch mobile telephony markets or in any other related markets.
E-Plus Mobilfunk GmbH & KG is Germany's third largest mobile phone operator after Deustche Telekom's T-Mobil and D2 Vodafone. E-Plus is currently jointly controlled by Koninklijke KPN NV and US-based BellSouth Corporation.
As a result of the proposed transaction KPN will take sole control over E-Plus. The deal was notified to the Commission for regulatory clearance on February 7.
The Commission's examination of the competitive structure of the market showed that E-Plus is only active in Germany and that KPN does not offer mobile telephony services of its own to end-customers in Germany except through E-Plus. Therefore, it was concluded that the proposed transaction would not lead to any overlaps between the activities of KPN and E-Plus or addition of market shares for services to end-customers in Germany or in any other European Union country.
In addition to its 77.49 percent stake in E-Plus, KPN is active as a mobile phone network operator in the Netherlands and Belgium. As such KPN and E-Plus provide wholesale international roaming services to foreign network operators and, at the same time, receive such services from operators in other countries, in order to offer its customers a seamless mobile telephony service outside their own national territory. Due to the cross-border element of wholesale international roaming services, there is therefore an existing vertical link between E-Plus and KPN.
The Commission's investigation focused on the Dutch wholesale international roaming market after the market investigation had showed that KPN is the clear market leader in this market with a market share of over 50%. The Commission assessed whether the proposed transaction would have any significant effects on the provision of wholesale international roaming services in the Netherlands and, in particular, whether the change from joint to sole control by KPN over E-Plus would allow KPN to strengthen its significant position in this market.
But the investigation showed that even if KPN were able to direct all traffic generated by E-Plus' subscribers roaming in the Netherlands onto its network this would not have any significant effect on KPN Mobile's position in the market for wholesale international roaming or any related markets given the insignificant share of total inbound roaming traffic E-Plus' subscribers generate on the Dutch market.
The Commission therefore concluded that the proposed transaction would not raise any competition concerns and approval under the Merger Regulation.