Fixed and mobile services provider Vodafone New Zealand and pay-TV operator Sky Network Television have applied to the country’s business watchdog, the Commerce Commission, for clearance to proceed with their proposed merger. The two firms say the tie-up ‘will not result in any substantial lessening of competition’ since there is no overlap between their respective service portfolios. Sky’s application states: ‘The combined group will face strong and growing competition across pay-TV, premium content and telecommunications markets.’ The Commerce Commission says it will study the two applications together and will give clearance to the tie-up only if it is ‘satisfied that the merger is unlikely to have the effect of substantially lessening competition in a market’.
As reported in CommsUpdate when the deal was first announced last month, Sky plans to acquire all of the shares in Vodafone NZ for a total purchase price of NZD3.437 billion (USD2.33 billion) through the issue of new Sky shares – giving UK-based Vodafone Group a 51% interest in the enlarged Sky – plus a cash consideration of NZD1.250 billion, to be funded through new debt. Sky Network Television is New Zealand-owned and is not connected to the UK-based pay-TV operator of the same name.