The Federal Cartel Office, Germany’s competition regulator, has submitted an application to the EU Commission to transfer the proceedings to Germany for the probe of the deal between US media giant Liberty Global and local number three cableco Kabel…
The Federal Cartel Office, Germany’s competition regulator, has submitted an application to the EU Commission to transfer the proceedings to Germany for the probe of the deal between US media giant Liberty Global and local number three cableco Kabel BW.
A spokesman for the regulator said that the application was submitted because the deal would mainly affect competition in Germany, TelecomFinance has confirmed. He added that the transaction was originally registered with the Commission for formal reasons.
In an email to TelecomFinance at the end of March, the spokesman said it had yet to be notified about the deal, and that it had not yet been decided whether the European Commission or the Cartel Office would examine it.
In late March, Liberty Global finally announced it would buy Kabel BW for E3.16bn, after weeks of speculation about Swedish private equity firm EQT’s favoured exit strategy.
But regulatory questions may be the main stumbling block, since Liberty would presumably merge Unitymedia and Kabel BW, the respective number two and three players.
In the past, the Federal Cartel Office competition regulator told KDG it could not merge with Kabel BW or Unitymedia on anti-trust grounds. In 2002, Liberty itself was not allowed to buy incumbent Deutsche Telekom’s cable assets, which were sold off in regional blocks, some of which became KDG.
However, the Cartel Office’s main concern may not be Liberty’s increased regional footprint. Instead, it is feared that some content providers could be discriminated against by a stronger player.
One report earlier this year quoted a source who said Liberty could consider slightly lowering the feed-in fees paid by broadcasters to access Kabel BW’s network.
