New Zealand’s largest mobile operator Spark is seeking a delay from the courts in the event the regulator clears a proposed merger between Sky Network Television and Vodafone New Zealand.
Spark said in a statement it is asking the High Court for a 36-hour stay to enable time for all parties “to fairly consider their legal options before the merger became a fait accompli”.
The Sky Network/Vodafone deal was announced last June.
A regulatory decision on the planned merger was pushed back in December due to the “significant volume” of material the Commerce Commission needed to work through, with a ruling on the proposed merger expected on Thursday. The watchdog in late October called for more input into its review, with regard to how the deal could impact competition in New Zealand’s telecoms and pay-TV markets. This included the ability of the merged company to use content to put a squeeze on rival broadband and service providers through competitively-priced bundles.
After announcing the deal, Sky tried to allay some competition concerns by entering into talks with 2degrees, the country’s number three mobile player, about a possible content deal.
Spark’s legal action comes after Sky TV said last week said it won’t delay the planned NZD1.25 billion ($903 million) merger for a few days to allow for appeals if the deal gets the green light from the regulator.
Spark GM of regulatory affairs John Wesley-Smith said a short pause would provide some “breathing space” to allow all interested parties to consider the commission’s reasoning behind a clearance decision, as this would be pivotal in assessing their legal review options.
“To allow Sky and Vodafone to push ahead with the merger without this breathing space would likely mean the merger would already have been effected, and be difficult to unwind, before opposing parties have had a chance to view the detailed reasoning underlying the commission’s decision,” he said in a statement.
He went on to say Spark expects the commission’s reasoning to be relatively detailed and fairly complex given the amount of information that has been put before it, so it’s reasonable to have a short period to digest the decision before it is approved.
Wesley-Smith said this does not mean Spark has already decided to take legal action to review in the event the commission gives its clearance. “That will depend on the reasoning upon which the commission has based its decision. But it does reflect how seriously we are taking the proposed merger, which we believe will have significant implications for competition.”