London - European shares edged higher early on Monday, led by the telecoms sector after Telenet's move to buy KPN's mobile telephony unit in Belgium.
Belgium's Telenet, a subsidiary of cable company Liberty Global, rose 4 percent after agreeing to acquire KPN's BASE Company for 1.33 billion euros ($1.4 billion), sending shares in the Dutch firm up 2.4 percent.
The deal will create a stronger operator in Belgium's mobile market as fixed and mobile telecom services converge, with estimated sales of 2.4 billion euros and adjusted operating earnings of 1.1 billion euros, Telenet said in a statement.
“It seems pretty good for both,” Michael Bishop, an analyst at RBC Capital Markets, said. “A slightly higher price for KPN than had been speculated and slightly better synergies compared to market expectations for Telenet.”
As a result of taking over Base's network, Telenet will no longer need to rent capacity from Belgium's second-largest network operator, Mobistar, shares in which fell 13.9 percent.
At 07h52 GMT, the pan-European FTSEurofirst 300 index was up 0.7 percent to 1,617.52 points after shedding 2.3 percent in the previous week.
The index was also helped by a rise in basic resources stocks after the Chinese central bank unveiled new measures to shore up the world's second-largest economy and top consumer of metals.
Banca Popolare di Milano was up 2 percent after Italian daily Il Corriere della Sera outlined a possible merger between the domestic Italian lender and peer Banco Popolare .
Oilfield services provider Petrofac fell 12 percent after warning costs at its Laggan-Tormore project would be higher than expected.
Reuters