Deutsche Telekom eyes mega-merger with French rival Orange - reports

Deutsche Telekom has announced it is in talks to make a major acquisition, purportedly of French telco giant Orange, according to German business daily Handelsblatt.

On Tuesday, Deutsche Telekom release a statement claiming it was eying up an acquisition, but did not disclose further details.

"Shareholders are advised that Telekom is in discussions in relation to a potential acquisition, which if successfully concluded, may have a material effect on the price of the company's securities."

Orange meanwhile has denied merger discussions with the German firm.

However, the Orange union, the French Confederation of Management - General Confederation of Executives, has come out against a potential merger, citing French sovereignty concerns.

Orange has substantial employee ownership, holding five per cent of equity and nine per cent of voting rights.

DT currently has a market cap of around €73bn, in comparison to Orange's €40bn, which would likely drastically reduce Orange employee influence.

Such a deal would also be subject to approval form the EU Commission in Brussels, which is traditionally against mega-mergers due to consumer interest grounds.

Currently, Deutsche Telekom shares are up 1.4 per cent, and Orange's are down 0.2 per cent on NYSE.

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