Vodafone, Ziggo merge in billion euro cash deal

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Vodafone Nederland and Ziggo are merging to form a single joint venture, Ziggo owner Liberty Global announced on Monday evening. By merging the companies aim to create "a stronger fixed and mobile competitor in the Dutch market", with Ziggo's broadband network and Vodafone's mobile operations. 

Both companies will control 50 percent of the shares in the joint venture. To equalize the ownership, Vodafone will make a 1 billion euro cash payment to Liberty Global.

The companies expect to eventually save 280 million euros per year, by cutting costs on infrastructure, marketing and administration. Layoffs weren't mentioned in the announcement.  The deal is expected to around the end of this year, pending approval from the European Commission. It is unclear under which name the new joint venture will operate and whether anything will change for existing Ziggo and Vodafone customers.

Ziggo is already active in the mobile market, via the Vodafone network. And Vodafone already offers internet and television services through the KPN network. By merging the two companies can offer both mobile and internet/television services, using only their own infrastructure, thereby being able to compete with companies like KPN.

Liberty Global also announced Ziggo's quarterly figures on Tuesday. In the fourth quarter of 2015 the company lost 50 thousand television clients, bringing the total to 4.09 million. The number of internet clients stayed about the same at 3.1 million and the number of mobile clients increased with 5,900 to almost 187 thousand.

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