MM02 drops the M & M's

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MM02 changes name and buys back shares
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mmO2 is looking to buy out thousands of small shareholders. Staying in touch with so many shareholders is too costly, the cellco says.

Following its spin-off from BT in November 2001, mmO2 has more than a million shareholders who own fewer that 600 shares each. While these 1.04m investors represent 63 per cent of the company's total number of shareholders, they only account for 3.5 per cent of the company.

"The cost of servicing such a large number of shareholders is significant. In many cases it is likely to cost O2 more to send dividend cheques to its small shareholders than the amount of the dividend they are receiving," said mmO2 in a statement today.

In the shake-up, mmO2 is to be acquired by a new company, O2 plc. Shareholders can either opt to exchange their mmO2 shares for O2 plc shares or cash in their small share in the company.

If all goes to plan, shares in mmO2 will cease to be traded on the London Stock Exchange on 11 March and begin trading as O2 plc on 14 March