TeliaSonera, Telenor to combine Danish operations

Nordic operator TeliaSonera and Norway-headquartered Telenor have announced an agreement to merge their Danish operations into a joint venture, of which each party will hold 50%. The two telcos said the new company will create a robust new operator in the very competitive Danish market.

A Telia-Telenor Denmark combination will create the country’s new number one, as according to figures from analysts Ovum their combined market share is about 45%, which will put it ahead of current number one, TDC, which has around 41% of the market. The Danish market also has a fourth operator, Three Denmark, which has about 14% share of the market and has been eating into TDC’s position over the last few years.

“Competition in Denmark is intense and we face continued pressure on revenue growth and profitability, making consolidation inevitable,” Kjell Morten Johnsen, EVP and Head of Telenor Region Europe said. “By combining the assets and customer bases of Telenor and TeliaSonera in Denmark, the joint venture will become a robust operator. We will be able to offer our customers a high-quality network with outstanding connectivity and the best customer experience in Denmark.”

According to TeliaSonera, the new joint venture will have about 3.5 million subscribers and more than DKK9 billion revenues in total. Telia and Telenor Denmark have had a network sharing agreement in place since 2012, and the operators said the merger would ensure better coverage and infrastructure and service investments. This move is reminiscent of te JV between Orange and T-Mobile to form EE in the UK.

“We are making a necessary and natural move by forming a joint venture with Telenor building on the network partnership we already have with them,” Robert Andersson, EVP and Head of Region Europe in TeliaSonera said. “By joining forces we can secure investments in Denmark, to the benefit not only of our customers but to the Danish society as a whole.”

TeliaSonera and Telenor have agreed on the terms of the transaction, which needs approval from the European Commission. The operators said they expect the deal to close sometime during 2015.