Since then, the bid has been under review by European competition authorities, including the UK Competition and Markets Authority (CMA).
The merger would create the UK’s largest mobile operator and reduce the number of competitors in the UK market from four to three. Regulators are concerned that the resulting mobile giant and reduction in competition would lead to rising prices and lower innovation in the industry. Consequently, the CMA has urged the European Competition Commission to block the deal, arguing that the merger would harm British consumers. Ofcom, Britain’s telecoms regulator, has also criticised the merger for similar reasons.
This deal differs from BT’s purchase of mobile network operator EE, which has recently been given the go ahead by the CMA. BT currently does not own any mobile assets and as a result, the deal will add a mobile offering to the company’s product base without affecting the number of competitors in the industry.
Consolidation in the UK mobile telecommunication market is one of many politically charged subjects facing Brussels, which is concerned that a regulatory mis-step involving Britain could fuel bitterness against the EU ahead of the Brexit referendum. The European Commission will have the last word on whether or not to approve the deal, and a final decision is expected before the 20th May.
_____________________________________