Deutsche Telekom and France Telecom are to merge their UK operations, T-Mobile and Orange UK, into a single joint venture pending Ofcom’s approval.

The new company will become the largest mobile carrier in the UK, with 37% of the UK market. The current leader in terms of market share, O2, has 27% of the market, followed by Vodafone with 25%.

The negotiations are expected to take up to 18 months while branding issues are resolved. Tom Alexander, CEO of Orange UK, said the merged network will most likely operate under a new banner.

"Both Orange and T-Mobile are household names in the UK, and neither brand will be discarded easily,” he said, adding that the company will most likely introduce a “’powered by’ type of brand, which supports those two clubs of customers”.

Last Friday, the Financial Times reported that T-Mobile had been in discussions with Vodafone and Spain’s Telefónica, in addition to France Telecom.