Where Japanese giants in smokestack industries chose to diversify into computer equipment in an effort to escape the spiral of decline in heavy industry, German companies in the same bind are looking to telecommunications. Steel pipe giant Mannesmann AG was the pioneer, but yesterday, industrial group Viag AG, which is to be merged with Germany’s third largest energy firm, Bayernwerk AG, announced that it had set up a telecommunications unit, and Veba AG was reported to have major plans for the sector ahead of liberalisation in 1998. Its new Telekommunikation Gesellschaft fr Betrieb und Dienstleistung mbH would aim to develop, expand and operate European networks for voice, data and video communications for large companies, starting with companies within the group. But it plans to invest about $300m to get the new company set to offer services to all comers. Meantime diversified energy group Veba AG said it was examining how to combine and expand its telecommunications businesses, although it dismissed as pure speculation a magazine report that it planned to invest up to $3,000m in it; RWE AG, Deutsche Bank AG and Mannesmann last month announced plans for a new communications venture (CI No 2,303).
