CK Hutchison has notified the €21.8bn merger of 3 Italia and Wind Telecomunicazioni to the European Commission. The move comes as the Hong Kong-based group awaits the final word on its agreed £10.5bn UK acquisition of O2 from Telefónica.
CK Hutchison (SEHK:0013) has reportedly notified the €21.8bn (US$24.6bn) Italian merger of 3 Italia and Wind Telecomunicazioni to the European Commission (EC). Wind is a subsidiary of Russian telco Vimpelcom (NASDAQ:VIP).
The move comes as the Hong Kong-based group awaits the final word on its agreed £10.5bn (US$15bn) UK acquisition of O2 from Telefónica (BME:TEF). That process has drawn opposition from Sharon White, CEO of local telecoms regulator Ofcom, in turn triggering a public letter by CK Hutchison chief Canning Fok (pictured).
Like the UK merger, the Italian combination would reduce the number of mobile network operators from four to three, a structure EC competition commissioner Margrethe Vestager has so far not supported. Unlike the UK deal, which would create a market leader, the Italian merger involves the number three and four players, which would form a stronger rival to Telecom Italia and Vodafone.
CK Hutchison did win approval to carry out similar mergers in Austria and Ireland from her predecessor Joaquín Almunia after agreeing to concessions aimed at strengthening existing MVNOs.
Vestager, though, has previously indicated that she prefers structural remedies because they “solve competition concerns once and for all.”
Brussels competition lawyer David Cantor was cited telling Reuters that Vestager could require 3-Wind to cede network assets to an MVNO, thereby creating a new fourth mobile network operator. A spokesperson for CK Hutchison was not immediately available for comment.