Hutch looks set to get EU ‘thumbs up’ for O2 Ireland merger

19 May 2014

Hong Kong-based Hutchison Whampoa (Hutch) is poised to secure regulatory clearance for its USD1 billion takeover of Telefonica of Spain’s O2 Ireland business, once it has inked a separate agreement aimed at creating a fourth mobile player in the Republic, local press quotes unnamed sources with knowledge of the matter as saying. The deal will make Hutch – which already owns network operator 3 Ireland – the second largest cellco in Ireland behind Vodafone, but concerns have been raised over a reduction in competition in the Irish market if the two merge.

In April this year European Union (EU) competition authorities announced their intentions to rule on the O2 Ireland deal by May, but postponed that deadline to 20 June 2014 to more thoroughly examine the ramifications. In the meantime, Hutch has offered to help in the setting up of a new market entrant, in a bid to assuage the authorities and clear the takeover of O2 Ireland. Under its plan, 3 Ireland would provide the would-be newcomer full control of parts of its own network, along with the option to purchase part of its existing subscriber base. Further, it would also allow the new operator to access its 4G spectrum, giving it a leg-up over Irish mobile virtual network operators (MVNOs) such as Tesco Mobile Ireland. Irish cableco UPC Ireland is tipped as the most likely player to enter the wireless sector, having already commenced discussions with 3 Ireland over a possible deal which would initially see it launch as a reseller before introducing a full-blown network operation. The unnamed sources claim that the Li Ka-shing-controlled conglomerate is in the final phase of talks to help Liberty Global-owned UPC Ireland, which currently offers internet and cable TV services, become an MVNO over 3 Ireland’s network.

Ireland, CK Hutchison, Hutchison 3G Ireland (Three Ireland), O2 Ireland