CK Hutchison’s £10.5 billion bid for Telefonica O2 in the UK is expected to be rejected by the European Commission, according to two media reports.
The news is unsurprising given the distance between the EU competition authorities and Hutchison.
While Hutch has argued that it will boost MVNO competition if the merger between 3 UK and O2 receives regulatory support, the commission has insisted on seeing a new, network-based entrant.
The EC’s position is supported by the UK’s Competition and Markets Authority, the country’s antitrust watchdog, as well as Ofcom, its telecoms regulator.
The EC is “within weeks” of blocking the deal, according to Bloomberg. The commission has a deadline of 19 May for concluding the case. The Financial Times also reported the deal faces rejection.
Hutchison is now turning its attention to whether it can win approval from the commission for the merger of its Italian unit with local rival VimpelCom, another consolidation deal that would reduce the number of operators from four to three.