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Eurobites: DT Down on Sprint's Withdrawal

Paul Rainford

Also in today's EMEA regional roundup: Liberty Global gets Euro/LatAm boost; Telecom Italia revenues down 11%; M2M developments.

  • Deutsche Telekom AG (NYSE: DT) is feeling the fallout from Sprint Corp. (NYSE: S)'s decision to abandon talks over a possible purchase of T-Mobile US Inc. , the German giant's American arm. As Bloomberg reports, shares fell by the most they had done in a year, more than 5%, on the back of the Sprint news. Trading was down 2.2% at €11.52 Wednesday lunchtime on the Frankfurt exchange. T-Mobile had earlier rejected a $15 billion bid from French upstart Iliad (Euronext: ILD). (See Sprint Drops Bid for T-Mobile – Reports and T-Mobile Rejects Initial Iliad Bid – WSJ.)

  • Liberty Global Inc. (Nasdaq: LBTY), which last year bought the UK's Virgin Media and is currently trying to bolster its European presence by acquiring Dutch cable operator Ziggo B.V. , saw second-quarter revenues rise 51% year-on-year to $4.6 billion, with much of that growth coming from the addition of Virgin's income. According to a company statement, strong results in Germany, the UK, Belgium and Latin America helped drive growth.

  • It's not such a bright picture at Telecom Italia SpA (NYSE: TI), where revenues fell 11.2% year-on-year to €10.55 billion ($14.07 billion) in the first half of 2014. The operator blamed the disappointing figures on "recessionary tensions" in the domestic market, and an economic slowdown in Latin America.

  • Also heading south, results-wise, is Russia's VimpelCom Ltd. (NYSE: VIP), which posted second-quarter net profits down 83% year-on-year to $100 million, on revenues down 11% to $5.07 billion, reports Reuters. The operator pointed the finger at tough economic conditions domestically, as well as the current turmoil in Ukraine.

  • Still in Russia, state-controlled operator Rostelecom says it has put the finishing touches to its mobile joint venture with Sweden's Tele2 AB (Nasdaq: TLTO), reports Reuters.

  • Telit Communications Plc , the Indian M2M specialist, has become the latest company to sign up to Telefónica SA (NYSE: TEF)'s M2M Channel Partner Programme. The move means that Telit will be able to offer local Telefónica connectivity services to customers in Europe and Latin America.

  • Virgin Media Inc. (Nasdaq: VMED) has begun work on what it says is the largest single expansion of its network since the company launched in 2007. Virgin is extending the reach of its 152 Mbit/s fiber network -- which feeds its TiVo-based TV service -- to 100,000 homes in East London.

    — Paul Rainford, Assistant Editor, Europe, Light Reading

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