MasOrange on track to achieve expected JV synergies

MasOrange was expecting synergies of 500 million euros four years after the closing of the transaction

MasOrange, Spain’s largest mobile operator as a result of the merger between local carriers Orange Spain and Masmovil, said it had achieved savings of 85 million euros ($92 million) in the first nine months of the year as a result of the merger.

The telco also said it aims to achieve synergies of 100 million euros for full year 2024. The JV was expecting synergies of 500 million euros four years after the closing of the transaction.

In its earnings statement, MasOrange noted it added 350,000 incremental customers between fiber optic lines and mobile postpaid in the January-September period.

During this period, MasOrange’s total revenue amounted to 5.46 billion euros, up 0.5% year-on-year, while the telco’s adjusted Ebitda reached 2 billion euros, up 7.5% year-on-year.

Also, the Spanish operator said it invested a total of 783 million euros in the first three quarters of the year.

At the end of September, MasOrange had about 33 million lines -excluding M2M lines-, of which, 25.8 million are mobile and more than 7.1 million are fixed broadband lines.

“We are very satisfied with our results for the first nine months of the year in which we continue to grow solidly in revenue, customers and profitability; and our ability to achieve the announced synergies,” said Meinrad Spenger, CEO of MasOrange.

The telco said it plans to continue with the extension of its 5G network this year with the aim of reaching 100% of nearly 750 Spanish municipalities with more than 10,000 inhabitants.

According to the company’s plans, its 5G network will reach almost 3,700 municipalities by the end of 2024. Currently, MasOrange covers 86% of the Spanish population with its 5G network, provding 5G coverage in 3,500 municipalities across the country.

By the end of 2024, the telco said it plans to reach more than 2,400 municipalities with less than 5,000 with its 5G network.

The telco highlighted it currently has nearly 10,000 sites which operate in the 700 MHz band. Of the total 700 MHz nodes that the company currently has, about 5,500 are distributed in nearly 2,500 towns with less than 50,000 inhabitants. Likewise, around 600 small towns and villages with less than 1,000 people also benefit from this mobile network, the telco said.

In April, MasOrange said it planned to invest 4 billion euros in the European country within the next three years.

Earlier this year, Orange and Masmovil completed a joint venture combining their operations after the clearance provided by the European Union and the Spanish government.

The Council of Ministers of Spain gave the approval for the Orange-Masmovil merger “with specific commitments and conditions”, including the implementation of an “ambitious industrial plan”.

The European body had said the approval is conditional upon full compliance with a commitments package offered by Orange and Masmovil.

During its in-depth investigation, the commission said it gathered extensive information and received feedback from market participants and other stakeholders. Following its investigation, the body said it had concerns that the transaction, as initially notified, would restrict competition in the retail markets for the supply of mobile and fixed internet services in Spain, whether offered standalone or in bundles.

However, to address the commission’s competition concerns, Orange and Masmovil committed to divest spectrum held by MasMovil to Spanish MVNO Digi Communications across three frequency spectrum bands, two medium frequency bands (1,800 MHz and 2,100 GHz) and one high frequency band (3.5 GHz). The mobile spectrum to be divested will enable Digi to build its own mobile network.

The new JV was initially announced in July 2022.