Sky, Vodafone NZ takeover denied by Commerce Commission

23 Feb 2017

The Commerce Commission of New Zealand has declined to allow Sky Network Television’s proposed takeover of Vodafone New Zealand to go ahead, citing concerns over the negative impact on competition in the broadband and mobile communications markets in the country. Chair of the Commerce Commission, Dr Mark Berry stated that the watchdog had outlined its concerns over the merger in October 2016 and subsequent submissions had not resolved these worries. The Commission concluded that as a result of this they could not guarantee that the takeover would not substantially decrease competition in New Zealand’s telecoms markets. According to Reuters, Sky CEO John Fellet has noted that the company is considering appealing to the High Court over the refusal, but will wait until two weeks’ time when the regulator’s full report on the matter is due before making a decision.

As previously reported by TeleGeography’s CommsUpdate, in June 2016 Sky Network Television (which is New Zealand owned and not part of the European satellite TV group of the same name) agreed 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 merged company – plus a cash consideration of NZD1.250 billion, to be funded through new debt. The merged Sky/Vodafone entity would have been controlled by Vodafone Group.

New Zealand, Commerce Commission of New Zealand, Vodafone Group, Vodafone New Zealand