BWB slams brakes on A1, Yesss! deal; new phase review could take five months

29 Jun 2012

A1 Telekom Austria’s planned acquisition of mobile virtual network operator (MVNO) Yesss! from counterpart Orange faces an extended review by Austria’s federal competition authority, Bundeswettbewerbsbehorde (BWB), delaying Hutchison Whampoa’s previously agreed EUR1.4 billion (USD1.87 billion) takeover of the France Telecom-Orange owned unit. The BWB issued a statement this week indicating that the mooted combination of A1 Telekom Austria and Yesss! would have negative consequences for the domestic wireless market in general and consumers in specific, who would likely face higher prices. A BWB media release stated: ‘The disappearance of Yesss’s aggressive price policy would remove the only competitor to Telekom Austria’s current ‘bob’ brand. BWB fears price increases as a result, since competition in the pre-paid segment would end’. The BWB said that it regretted that the parties involved had been unable to agree on any concessions relating to the deal after four months, but warned that the ‘next phase review’ by the Austrian cartel office could take at least five months.

As previously reported by TeleGeography’s CommsUpdate, the deal between FT-Orange and Hutchison involves H3G offloading around 3,000 of Orange’s 5,000 base stations, divesting surplus frequencies in the 2.1GHz spectrum band, and selling Yesss! to A1 Telekom Austria immediately after the transaction; the main sticking point is transfer of 750,000 Yesss! subscribers. If the anti-monopoly agency decides to formally block the transfer of the Orange assets to Telekom, Hutchison is understood to be prepared to walk away from the deal.

Austria, A1 Telekom Austria, Orange Austria, Yesss!