CK Hutchison and Cellnex Telecom were granted five days to address UK Competition and Markets Authority (CMA) concerns over a planned sale of tower assets to avoid a deeper probe into the deal.
The CMA stated an initial examination showed a deal could lead to competition hazards regarding the independent supply of passive infrastructure assets, and explained a second-phase would go ahead if CK Hutchison and Cellnex failed to address its concerns.
In its findings, the regulator expressed concerns the purchase of towers currently owned by 3 UK would enhance Cellnex’s position in the country, where it already operates the majority of independent towers after acquiring the telecoms unit of Arqiva in 2020.
The UK watchdog pointed to evidence suggesting CK Hutchison could have sold its tower assets to an alternative buyer, which would have resulted in increased competition to Cellnex.
As a consequence, CMA chief economic adviser Mike Walker claimed the takeover could lead to obstacles for new direct competitors to emerge, and as a consequence impact pricing and quality of services.
Cellnex and CK Hutchison need to provide the CMA with legally-binding proposals addressing the concerns within five working days (it issued the decision on 13 July), with the regulator then allocating a further five days to decide on whether to proceed to a second-phase probe.
The deal is part of a broader CK Hutchison crusade to acquire tower assets in Europe, totalling €10 billion.Subscribe to our daily newsletter Back