Vodafone, Orange keen for telecoms consolidation in Spain, local CEOs say

MADRID (Reuters) – Britain’s Vodafone and France’s Orange are keen to play a role in any consolidation of Spain’s highly competitive telecom sector, local chief executives for the two companies said on Thursday.

Vodafone’s local CEO Colman Deegan said lower competition would help operators build the financial muscle to roll out 5G technology.

“At Vodafone, we want to play an active role in the process of telecom consolidation in Spain,” Deegan said in an op-ed piece published by Expansion newspaper on Thursday.

He said the current state of the market had reduced profitability and left providers without the financial capacity to pay for the infrastructure needed to develop 5G technology.

Vodafone, together with rivals such as Telefonica and Orange, have pressured the European Commission to soften anti-trust rules that promote competition, arguing that overcrowding in markets such as Spain hinders investment.

Deegan’s position was echoed by Orange Spain’s CEO Jean-Francois Fallacher, who complained that the three main telecom providers investing in the Spanish market were suffering.

“We are very favourable to consolidation for the market and it’s the right way to go – if any opportunities are there we’ll look at them with a lot of care,” he told reporters at an event on Thursday.

In a sign of pressure on the sector, three of Spain’s leading operators announced extensive job cuts this year, including Vodafone, Orange, and most recently Telefonica which offered redundancy to over 3,000 of its most senior staff last month.

(Reporting by Inti Landauro and Clara-Laeila Laudette; editing by Jason Neely and Bernadette Baum)