Now it has been announced that instead of Tele2 acquiring Versatel, the two will instead merge their Dutch and Belgian operations. Effectively, the deal will see Versatel acquire the Dutch and Belgian units of Tele2, financed by the issuing of new Versatel shares.

Speaking to Computer Business Review, a Versatel spokesman confirmed there were no financial details of the transaction available, and that it would depend of the value of the deal (which has yet to be decided) as to whether a shareholder meeting has to be convened to approve the transaction, which is expected to be finalized before the end of the year.

Versatel also revealed that it may require additional capital to fund its existing business plan. The Amsterdam, Holland-based company has been burning through cash lately and is currently sitting on cash and cash equivalents of 66.9m euros ($86m) as of the end of June, down from 106.5m euros ($137m) six months ago. The company is in the process of axing 200 staff from its total workforce of 1,100 in an effort to reduce costs.

For the second quarter ending June 30, Versatel posted a net loss of 34.7m euros ($44.6m), compared to net income of 1.8m euros ($2.3m) a year earlier. Sales however rose to 104.4m euros ($134m), from 93.3m euros ($120m) a year earlier.

Versatel was founded in October 1995 as a competitor to the then-state company Royal KPN NV, which is still the largest telecoms carrier in the Netherlands. Versatel primarily focuses on the Dutch, Belgian, and German markets.

Tele2 currently owns 82.4% of Versatel, after the Stockholm, Sweden-based carrier submitted an offer worth 1.34bn euros ($1.61bn) last July to acquire Versatel. However it failed to reach its target of 95% ownership of Versatel after an effective campaign by a group of Versatel shareholders known as TeleNee (literally translated as TeleNo).

By June this year, eleven months after the deal was first proposed, Tele2 had enough and said that it was putting the deal on hold while its considered other alternatives. These alternatives included Versatel acquiring Tele2’s Dutch and Belgian operations.

For the second quarter ending June 30, the UK and Benelux regions of Tele2 grew sales by 37% to SEK 2.22bn ($310m). This region included the UK, the Netherlands, Luxembourg, Liechtenstein, and Belgium. Tele2 has since sold off the UK and Ireland to the Carphone Warehouse Plc.