Orange Spain and MásMóvil to merge

Orange and Spanish service provider MásMóvil have entered into exclusive negotiations to merge their Spanish businesses in the form of a 50:50 JV.

The merger of the two companies would create an entity with a market valuation of about €19.6 billion, comprising €8.1 billion for Orange España and €11.5 billion for MásMóvil. The latter figure includes MásMóvil’s acquisition of northern Spanish cable operator Euskaltel.

The combined company will have a FTTH network that reaches over 16 million homes, with revenues of over €7.5 billion and EBITDAaL of €2.2 billion.

According to Orange and MásMóvil, the combination will enable the company to expand its FTTH and 5G networks and help Spain maintain and develop a competitive telecom infrastructure.

The merger, which is expected to deliver synergies of €450 million from the third year, should close in the second quarter of next year, subject to regulatory approvals.

Neither Orange nor MásMóvil owner Lorca JVCO will consolidate the combined operator, but both parties retain the right to trigger an IPO, with Orange given a path to control the combined company in the case of a public listing.

Stéphane Richard, Chairman & CEO of Orange, said: “I look forward to creating this joint-venture with MásMóvil, building on our existing successful collaboration, to become a stronger player capable of making the investments required to develop the Spanish market. I know I can count on Jean-François Fallacher and the entire Orange Spain teams for their full mobilization until the closing in order to make this deal a success.”

Meinrad Spenger, CEO of MásMóvil, said: “To assure leading telecom infrastructure in 5G and FTTH as well as outstanding service in Spain, we need strong operators with sustainable business models. The combination of Orange and MásMóvil would be beneficial for the consumers, the telecom sector and the Spanish society as a whole.”

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