The European Commission (EC) confirmed the opening of an in-depth investigation into a Vodafone Group plan to acquire Liberty Global businesses in Czech Republic; Germany; Hungary; and Romania, citing competition concerns for two of the markets.
An initial EC investigation led to unease about the Czech Republic, where providers of standalone services could be shut out from mobile, internet and TV markets because of the converged products the merged company could offer.
And in Germany, where Vodafone competes with Liberty Global in a number of markets via wholesale access to Deutsche Telekom’s xDSL network, the commission cited the removal of competition between the merged companies; a possible impact on investment in next-generation networks; and a “substantial increase” in the bargaining power of the combined company with TV broadcasters.
The EC said it has not identified specific competition concerns related to Hungary and Romania.
In a statement, Mike Fries, CEO of Liberty Global, said: “We always anticipated a second phase review given the size and scope of the transaction, and it is clear that the EU is retaining regulatory authority over the case. This provides us with the appropriate forum to demonstrate the consumer benefits that will be delivered by the creation of fully converged, fixed-mobile operators in these four markets.”
Last month, Germany’s Bundeskartellamt had requested a referral of the deal as far as the German market was concerned, stating it could “lead to considerable changes in the market conditions in the cable TV and telecommunications sector”. But the EC’s latest move shows its intention to retain jurisdiction over the case.
The EC now has 90 working days, until 2 May 2019, to take a decision.Subscribe to our daily newsletter Back