1 Jul 2016
CK Hutchison and VimpelCom are planning to offer further concessions to help convince the European Commission (EC) to approve the EUR21.8 billion (USD24.2 billion) merger of their respective telecoms businesses in Italy. A report from Bloomberg says that the extra concessions will be submitted ‘within days’. The EC is due to lay out any objections it has to the merger by next week, with a final decision to be made by 8 September. The Commission recently blocked a deal to combine UK mobile providers 3 and O2 on competition grounds, and Hutchison and VimpelCom are keen to avoid a similar fate in Italy.
The combination of Hutchison’s 3 Italia and VimpelCom’s Wind Telecomunicazioni would create Italy’s largest cellular operator by subscribers, leapfrogging current mobile market leaders TIM and Vodafone. The parties have already offered to offload some spectrum and network assets to allow for the creation of a new mobile operator in Italy, ensuring that the market retains its current four-player setup. Swisscom’s Italian ISP Fastweb and Iliad of France are the front runners to acquire the assets, and Bloomberg suggests that Iliad’s application is currently the favourite with EC competition authorities as it has proposed a more aggressive network rollout, though it adds that Fastweb has recently raised its planned coverage target to 100% by 2020.