While the U.S. is slumbering...
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<<Royal KPN Is Said to Pursue a Deal With Japan's Docomo
By ANDREW ROSS SORKIN
ONDON -- Just days after the Dutch telecommunications company Royal KPN called off merger talks with Telefonica SA of Spain, KPN returned to the bargaining table with a third possible partner, DoCoMo Inc. of Japan, according to executives close to the talks.
Royal KPN, the largest telephone operator in the Netherlands, and DoCoMo, the mobile operation of Nippon Telegraph and Telephone, have been negotiating in fits and starts for over a month now. They are hoping to reach an agreement that could include an alliance between the two companies' mobile telephone operations. If they do form an alliance, each company might take a small ownership stake in the other, the executives said. Both companies have also discussed a joint bid for Orange PLC, Britain's third-largest mobile telephone operator, the executives said.
Orange is expected to be put up for sale by Vodafone AirTouch PLC, which has to dispose of Orange as a condition of its $183 billion acquisition of Mannesmann AG. Analysts expect a fierce bidding war for Orange, which is expected to sell for about $50 billion.
While no agreement between Royal KPN and DoCoMo has been reached, executives close to the negotiations said they hoped to complete a deal by the end of the week. The executives stressed that, as with any negotiation, either side could still decide to abandon the effort.
The talks between Royal KPN and DoCoMo come as Royal KPN weighs its next move after the collapse of talks between Royal KPN and Telefonica on Friday. If that deal had been completed, it would have catapulted the companies, both of them formerly state-owned telephone operators, into the ranks of the major players in Europe's telecommunications race. The stocks of both companies were expected to drop Sunday.
The failed deal with Telefonica puts Royal KPN, which has an alliance with Qwest Communications International of the United States and which is partly owned by BellSouth Corp., in play as a potential takeover target, according to analysts. A bevy of other European telephone operators and several U.S. telecommunications companies are looking to establish footholds in Europe.
Analysts point to Vivendi and Bouyges Telecom, both from France, as well as the German mobile phone company Debitel, a unit of DaimlerChrysler, as possible suitors for Royal KPN.>>
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