EU approves Hutch’s takeover of O2 Ireland

29 May 2014

The European Commission (EU) yesterday granted formal approval to the takeover of mobile operator O2 Ireland by rival Hutchison 3G Ireland, which trades as 3 Ireland and is owned by Hong Kong’s Hutchison Whampoa. The European authorities had previously expressed concerns that the tie-up would adversely affect competition in the Irish market and launched an in-depth review. In the wake of the announcement, 3 Ireland’s parent submitted a number of commitments to the European Commission (EC), promising to help new competitors enter the domestic mobile market, and the EC now says that 3 Ireland’s commitments to ensuring competition have removed their concerns. In brief, 3 Ireland has promised to support the entry of two new mobile virtual network operators (MVNOs), with an option for one of them to become a full mobile network operator (MNO) at a later date. Further, Hutch has also put forward a package aimed at ensuring that Eircom, which owns and operates the Meteor Mobile brand, stays a competitive MNO. Commenting on the decision to approve the bid, EC vice president in charge of competition policy, Joaquín Almunia, said: ‘In a context of increased data consumption on their mobile devices, European consumers should continue to benefit from improved services at attractive prices … To achieve this, it is essential that healthy competition is preserved in mobile telecoms markets. The commitments offered by Hutchison 3G Ireland ensure that Irish consumers will continue to enjoy these benefits.’ Both O2 Ireland and 3 Ireland say customers will not be affected by the takeover.

In June 2013 Hutch agreed to pay up to EUR850 million (USD1.2 billion) for O2 Ireland, adding it to its existing Irish venture, 3 Ireland. The combination will boost Hutch’s market share by a factor of roughly four to close to 39%, according to TeleGeography’s GlobalComms Database.

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