BT aims to complete the deal in the coming weeks
The United Kingdom’s Competition and Consumer Authority cleared the way for BT to acquire mobile operator EE, the regulator said in a statement. The decision follows CMA’s provisional decision to clear the acquisition in October 2015.
After looking in detail at different markets – including the supply of retail mobile, wholesale mobile, mobile backhaul, wholesale broadband and retail fixed broadband services – CMA decided the deal is not expected to result in a substantial lessening of competition in any market in the U.K. The regulator said the BT Group and EE operate largely in separate areas, with BT strong in supplying fixed communications services, EE strong in supplying mobile communications services and limited overlap between them in both categories of service. EE is currently owned by Deutsche Telekom and French telco Orange.
“Since our provisional findings, we have taken extra time to consider responses in detail but the evidence does not show that this merger is likely to cause significant harm to competition or the interests of consumers,” explained CMA’s inquiry chair John Wotton. “The retail mobile services market in the U.K. is competitive, with four main mobile providers and a substantial number of smaller operators. As BT is a smaller operator in mobile, it is unlikely that the merger will have a significant effect. Similarly, EE is only a minor player in retail broadband, so again it is unlikely that the merger will have a significant effect in this market.”
BT said the CMA decision paves the way for the company to complete the acquisition of EE in the coming weeks and to incorporate the business into the wider BT Group in the months to come. BT also said there will be a distinct EE line of business following completion of the acquisition. Following completion of the deal Deutsche Telekom will control 12% of BT shares and Orange will control 4%. A DT representative is set to be appointed to the BT board.
The £12.5 billion ($17.9 billion) deal is set to create a large operator covering fixed and mobile telephony, broadband and TV. BT controls 31% of the U.K. fixed broadband market according to the local telecoms regulator Ofcom. The telco currently offers wireless service through a mobile virtual network operator agreement with EE.
EE ended the third quarter of the year with 31.3 million subscribers, including 12.6 million LTE customers. The operator’s LTE network currently reaches approximately 93% of the country’s population.
