Telefonica Deutschland (TD) stepped closer to European Commission (EC) approval of its proposed US$11.8 billion merger with KPN’s German E-Plus unit as it agreed on Wednesday to grant access to a fifth of the merged entity’s combined network capacity to Drillisch, a smaller rival. The pact with Drillisch—a mobile virtual network operator (MVNO) that provides wireless service to 1.94 million German customers through capacity leased on the Vodafone network—is intended to alleviate competitive concerns over the E-Plus transaction that will reduce the number of German national wireless competitors from four to three. Wednesday’s agreement also fulfills in part various concessions that TD had offered to win EC approval of the E-Plus acquisition. In addition to providing network access to up to three MVNOs, TD has also committed, among other things, to sell 10,000 cell sites and lease to a new market entrant 40 MHz of high- frequency spectrum that covers 50% of Germany’s urban population. Although the EC is expected to approve the E-Plus acquisition by July 10, ten European Union national authorities voted at a meeting last week to adopt a non-binding resolution against the transaction. Notwithstanding last week’s vote, an EC spokesman noted that at least 15 national authorities must vote against a proposed merger for the EC to officially take their position into account. EC Competition Commissioner Joaquin Almunia also stressed to reporters that the final decision will be made by the EC.