BRUSSELS, April 21 2000

The European Commission on Wednesday cleared mobile phone company Vodafone AirTouch Plc's takeover of Germany's Mannesmann AG after demanding the two firms demerge or sell Orange Plc, the British mobile phone company owned by Mannesmann.

Following is the Commission's statement.

"The European Commission has approved Vodafone Airtouch's (United Kingdom) acquisition of Mannesmann AG (Germany). 

The transaction has been approved after the parties submitted commitments to de-merge Orange Plc and to give other mobile operators access to their inter-operator roaming tariffs and wholesale services.

The Commission's investigation identified that the merger between Vodafone Airtouch and Mannesmann would have led to competitive overlaps in the national market for mobile telecommunication services in the United Kingdom and Belgium.

In order to remove the competition concerns, Orange Plc including all its subsidiaries will be de-merged as a stand-alone business. The de-merger process will start immediately after the Commission clearance.

Moreover, following the acquisition, Vodafone Airtouch will have a pan-European footprint which will enable it to provide seamless pan-European mobile telecommunication services to corporate customers. The Commission has received a significant number of complaints and found during the course of its investigation that other mobile operators would not be in a position to provide services on a pan-European basis.

The replication of Vodafone/Airtouch network footprint in the form of mergers and/or agreements would be highly difficult in the short to medium term.

Vodafone Airtouch submitted a set of substantial undertakings aimed at giving other mobile operators the possibility to provide pan-European advanced seamless services to their customers by using the integrated network of Vodafone Airtouch/Mannesmann. These undertakings will prevent the emergence of a dominant position for the provision of these services.

Due to the fast development of the mobile telecommunications sector, the award of so-called third generation UMTS (Universal Mobile Telecommunications System) licences and the fact that competitors will in all likelihood try to build up alternative infrastructures, the latter undertakings have been limited to a period of three years."