Bermudan authorities give green light to Digicel BTC takeover

11 May 2015

Digicel Group’s move to acquire Bermuda Telephone Company (BTC) has been granted approval by the island’s regulatory watchdog, The Royal Gazette writes. The decision by the Regulatory Authority of Bermuda (RAB) effectively paves the way for the takeover to progress on the proviso that all parties involved adhere to a number of conditions attached to the deal – details of which are yet to be made public. The paper cites RAB chief executive Robert Watson as saying that whilst it is aware of some people’s concerns at the potential emergence of two ‘joint dominant players’ in the domestic telecoms market, particularly where it relates to pricing, the watchdog is clear that it will monitor developments to ensure competition is not compromised. ‘We will keep a close eye on it to see there is no predatory pricing,’ he told the paper, adding that the RAB will also undertake a full market review in due course. Mr Watson added that the regulator had weighed up what he termed ‘the energy and experience of Digicel’ when coming to its decision, and decided that the Caribbean group’s experience and track record will help to ensure Bermudians receive the best services and prices going forward. He also attempted to reassure concerns that smaller players would not be squeezed out of the picture as a result of the tie-up, saying: ‘Any market goes through phases where there is consolidation, but there is always room for smaller players with individual products and services that are viable.’

TeleGeography’s GlobalComms Database writes that in January this year the RAB sought public comment on Digicel Group’s planned takeover of BTC, launching a consultation on a deal that under local telecoms law it confirmed fell ‘within the meaning of a concentration’, and as such required RAB approval if it was to close. A lengthy period of deliberation began on 20 February 2015, when the RAB received formal notification of the proposed deal in which Digicel Group agreed to acquire BTC – just six months after it was taken over by Canadian group Barrie OpCo. In July 2014 Barrie OpCo, a recently incorporated Bermuda company owned by an independent investor group with experience in telecommunications, purchased 100% of BTC from local telecoms firm KeyTech for BMD30 million (USD30 million). No details on the terms of the Digicel deal or indeed its value have been disclosed.

Bermuda, Bermuda Telephone Company (BTC), Digicel Group