Oulun Puhelin, together with five other large provincial telephone companies from Finland and the Finnet Group, are to form a new telecommunications company. Joining Finnet in this latest merger are the telephone companies Oulun Puhelin, Lännen Puhelin, Päijät-Hämeen Puhelin, and Satakunnan Puhelin, as well as the telecommunications operations of Enfo Group. One of the main aims of the planned merger is to achieve a better position for growth in providing broadband services.

The merger might also lead to job cuts, but no announcement of them was forthcoming yet. The aim is for product development personnel to continue their work in Oulu, Lahti, and other existing locations.
 

Finnet is a company linking regional telecommunications service providers. It also owns the mobile telephone operator DNA. The owners of the companies in the merger will retain ownership in the new company, with the exception of Lohjan Puhelin, whose business operations are to be bought out by Finnet for an undisclosed price.

The merger requires the approval of competition authorities, and it will be June before practical action can begin. It is possible that the new company will eventually be listed on the Helsinki Stock Exchange. The parties involved in the agreement are not saying if this is yet in the cards. However, the reticence is seen to be something of a formality, and there are strong suggestions that such move is likely.

Finnet CEO Jan-Erik Frostdahl is also not revealing how the ownership of the new company is to be distributed. The other parties of the merger currently hold nearly a two-thirds majority in Finnet.

The unification scheme is intended to be completed by the end of the year. The companies involved had a combined personnel of 1,300 last year, and a turnover of more than EUR 600 million. The merger will lead to the formation of a company that is among the largest 100 in the country. Frostdahl says that other companies in the Finnet camp are welcome to join the new company as shareholders.

The new head office is expected to be located in Vantaa, which already houses Finnet's current headquarters. The merger is not expected to be of any great consequence for the company's customers; while the product selections are to be integrated, there are no big differences between them even now.
      
The aim of the formation of a new company is to achieve more efficient growth in broadband activities. This could mean an expansion into the Helsinki region, where Finnet currently does not offer any broadband services.

The reason given for the purchase of Lohjan Puhelin is that the city of Lohja is seen to be a "strategically important" location because of its close proximity to Helsinki.

Finnet had tried to gain a foothold in the broadband market in the Helsinki region about two years ago. However, the experiment ended in 2006 when it sold the business to the company 24 Online.