The European Commission (EC) set a provisional deadline of 5 November to complete a review into the merger of Telefonica and Liberty Global’s UK operations, a deal which could drastically increase competition in the country’s converged communications market.
Its deadline is for an initial look at the deal and, although some M&A activity does get waived through at this stage, mega-mergers in the communications sector tend to warrant longer, more in-depth competition investigations.
If needed a wider probe would be announced prior to, or on, the November deadline.
A proposed tie-up between Liberty Global’s cable fixed and TV operation Virgin Media and Telefonica-owned mobile operator O2 UK was announced in May. It is expected to close in mid-2021, if cleared by authorities.
The companies intend to take a 50 per cent stake in the merged company, with Liberty Global paying a £2.5 billion sum to Telefonica as part of the deal.
Although European authorities have already begun assessing the competition implications of the agreement, they may yet lose ultimate responsibility for clearing it.
Earlier this year Financial Times reported comments from the UK’s Competition and Markets Authority (CMA), insisting it should have the final say on the deal due to it only impacting the nation.
The CMA also argued the EC’s review would likely spill beyond the end of the UK’s transition period of leaving the European Union at the end of 2020.Subscribe to our daily newsletter Back