Saturday, 29 February 2020

Vodafone–TPG merger gets the thumbs up

by Harry Baldock, Total Telecom
Thursday 13 February 20

After a back-and-forth with Australia’s regulator, the deal finally gets the approval it needs to proceed

It seems that February is the month for mergers to transcend legislative limbo.    On Tuesday, the long-awaited Sprint and T-Mobile finally got the green light to merge, and now, nearly 10,000 miles away, TPG and Vodafone Australia have finally secured the Australian regulators permission to do likewise…

It seems that February is the month for mergers to transcend legislative limbo. 
 
On Tuesday, the long-awaited Sprint and T-Mobile finally got the green light to merge, and now, nearly 10,000 miles away, TPG and Vodafone Australia have finally secured the Australian regulators permission to do likewise.
 
TPG initially agreed to merge with Vodafone Australia back in 2018. The antitrust regulator expressed some concern that the deal would remove a fourth player from the market but stopped short of blocking the deal.
 
At around the same time, the Australian government, at the behest of the US, banned Huawei from supplying 5G equipment to the nation’s operators. 
 
TPG’s network ambitions were heavily reliant on Huawei technology, and they announced at the start of 2019 that they no longer had plans of building their own mobile network. 
 
The regulator responded by blocking their merger with Vodafone, claiming that this would force TPG to return to their mobile network plans and remain a fourth player in the Australian mobile ecosystem. 
 
TPG have since challenged this ruling and today received the go-ahead to proceed with the A$15 billion (~US$10 billion) deal.
 
Justice John Middleton ruled that the merger would not substantially reduce competition and there was no legal reason to block the deal.
 
Iñaki Berroeta, chief executive of Vodafone Hutchison Australia, welcomed the decision saying: “This will give us the scale to compete head-to-head across the whole telecoms market which will drive more competition, investment, and innovation.”
 
The regulator will likely appeal this ruling and has 28 days to do so.
 
 
Also in the news:

Since you're here...

...the Telecoms industry is characterised by constant change and evolution. That's why it's crucial for telecoms professionals to keep up-to-date with what is happening. Join 35,000+ of your peers and sign up to our free newsletter service today, to be in the know about what is going on. PLUS, as a member you can submit your own press releases!

See all membership options

Please enable JavaScript to view the comments powered by Disqus.

Newsletter signup

Quickly get on board and up to date with the telecoms industry