European Commission Approves Deutsche Telekom Plan to Buy GTS Central Europe

Deutsche Telekom AG's plans to buy peer GTS Central Europe for 546 million euros ($755.4 million) from a group of private-equity firms, has received approval by the European Commission, the European Union's executive body.

"Customers would still have sufficient alternative suppliers in all markets affected," the Commission said in a statement Tuesday. It examined the effects of the merger on competition in several markets in Hungary, Romania, the Czech Republic and Poland, where the parties have overlapping activities or vertical links.

GTS's current owners, a consortium including private-equity firms Columbia Capital, HarbourVest Partners, Innova Capital and M/C Partners, will retain the Slovakian activities.

The activities of the two telecoms groups overlap on wholesale leased lines and retail business connectivity in Hungary and Romania. They also offer services for domestic call transit services in the Czech Republic and Hungary.

The acquisition would not raise any competition concerns in these markets, the Commission concluded. In particular, the Commission found that other strong players, such as Invitel and UPC in Hungary, Telefonica and Dial Telecom in the Czech Republic and Orange and Vodafone in Romania, will continue to compete with the merged entity in these markets.

A purchase of GTS would be a further step to develop an integrated mobile and fixed-line network, Deutsche Telekom Chief Financial Officer Timotheus Höttges said last year when announcing the deal.

Write to Frances Robinson at [e-mail]

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