The European Commission will later this week publish its preliminary findings into CK Hutchison’s £10.25 billion bid for rival Telefonica’s O2 UK.
According to The Telegraph, the two companies are braced for the commission to take a tough stance on the deal and push for major concessions.
Last week, the UK’s Competition and Markets Authority (CMA) waved through the £12.5 billion bid by BT for rival EE without demanding concessions.
The EC turned down a request from the CMA to lead the probe into the bid by Hutchison, parent of 3 UK, for O2.
According to Bloomberg, Margrethe Vestager met last week in Brussels with Sharon White, head of the UK telecoms regulator Ofcom. White outlined her concerns about the Hutch-O2 deal, namely that 3 UK’s innovative pricing will be lost to the UK market.
Three could be told by the EC to sell off network capacity to rival firms before it can buy O2. However, Vestager could go further in what she demands. Last year, Telenor and TeliaSonera dropped a merger in Denmark because they could not accept her conditions.
The two operators offered to facilitate the entry of a new mobile operator into the Danish market but Vestager was unhappy about the number of strings attached to the proposal. The two sides could not reach agreement. However, Vestager has also said there is “no magic number” in regards to operator numbers. A reduction in operators from four to three, such as in the UK, does not necessarily rule a deal invalid, the EC chief has said.