'

Deutsche Telekom, Orange confirm early talks with BT over EE buyout

Deutsche Telekom and Orange have confirmed they're in early talks with BT over the possible sale of EE, following earlier discussions with BT and O2 over a similar deal.

Deutsche Telekom and Orange are in talks with BT over the sale of their jointly-owned consumer mobile network EE.

Deutsche and Orange said today they are "having preliminary exploratory discussions with British Telecom" over a possible sale of EE, the UK's largest mobile network operator with around one-third of the market.

"Deutsche Telekom AG and Orange SA are having highly preliminary exploratory discussions with British Telecom,  although it is too early to state whether any transaction may occur. Deutsche Telekom and Orange will make further announcements if and when appropriate," the pair said in a statement.

The news confirms rumours of an EE sale, after BT on Monday told the BBC it had been approached by the owners of an unnamed network - reportedly EE - about a UK buyout.

The confirmation from EE's owners follows similar talks BT initiated with Telefonica about acquiring its UK mobile network O2. Telefonica on Monday confirmed it was in "highly preliminary stage" talks with BT over the future of O2.

BT spun off its mobile operator Cellnet in 2002 before renaming it mmO2 and then O2. Telefonica subsequently acquired it in 2005 for around £18bn .

BT's consumer portfolio currently includes fixed-line broadband, telephony, and TV. The operator signed a mobile virtual network operator (MNVO) deal with EE last year to deliver 4G, which it launched for business customers in May. The telecoms giants plans to launch consumer services by April 2015.

The addition of fast mobile puts BT on equal footing with Virgin Media by giving it the ability to sell 'quadplay' packages including fixed-line broadband, telephony, mobile, and TV.

BT flagged its possible re-entry to consumer mobile when it joined Ofcom's 2012 4G spectrum auction. Through the auction it secured 2.6GHz spectrum, while Telefonica secured 800MHz spectrum that came with an obligation to provide coverage of 98 percent of the population. The auction result caused speculation at the time that the allocation could favour a spectrum deal between BT and O2.

Read more on this story