Will Freeserve Fall in the Battle of Wanadoo?

French Internet service provider Wanadoo admitted Wednesday it has
considered snapping up British rival Freeserve Plc.

Published reports said the deal would establish Wanadoo as one of Europe’s
top three ISPs. Freeserve, 80 percent of which is owned by UK retailer
Dixons, wouldn’t confirm the deal but did say it was in talks with a company
about a purchase.

But any thing can happen between now and when the dealers come to the table:
France Telecom-owned Wanadoo said Freeserve was just one of the firms it was
peeping on.

Wanadoo, which had talked to French ISP LibertySurf about a potential
merger, would benefit from a more than 100 percent increase of subscribers
should it swing the Freeserve deal. Freeserve claims 2 million clients to
Wanadoo’s 1.8 million.

Freeserve could use a partner, some say. The firm wants to make a strong
push into wireless Internet, broadband Internet and instant messaging, which
means the outfit would need some heft behind its investments.

The rumor mill has spun yarns about a great deal involving Freeserve, which
was in talks with a number of European ISPs -including Wanadoo and Italy’s
Tiscali, since merger talks with Germany’s T-Online crumbled in June.

But the details are clearly fuzzy. Freeserve has often said it was not in
any talks which may lead to an offer being made for the company, a line it
echoed last week when it said it was not talking to anyone about a takeover.

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