European Commission orders second examination of Three acquisition of O2 Ireland

6 Nov 2013

Three Ireland, which is owned by Hutchison Whampoa, has said the European Commission’s decision to move to a Phase 2 examination of the acquisition of O2 Ireland was not unexpected.

In June, telecoms player Telefónica agreed to sell its O2 subsidiary in Ireland to Hutchison Whampoa for €850m.

The transaction will be subject to approval from the Competition Authority of Ireland, as well as the European Commission.

“The Commission’s decision to open an in-depth investigation is not unexpected in the context of previous statements by the Commission that it would take a close look at in-country telecoms mergers and does not in any way prejudge the final outcome of the Commission’s review,” Three said in a statement.

“Three believes that the merger of O2 Ireland’s business with Three Ireland will be good for both competition and consumers in Ireland and is confident that the merger will be approved by the Commission.”

Three said it has had “open and constructive” discussions with the European Commission in the first phase of the merger review process.

“It expects to continue to work closely with the Commission to obtain clearance for the acquisition,” Three said.

The telecoms operator said the Irish telecoms market has suffered for years from under-investment in broadband infrastructure because of the structure of the market – one market leader and three other network operators suffering from low or negative profitability.

“The merger with O2 Ireland will give Three Ireland the scale necessary to invest more heavily in its network infrastructure and compete more aggressively. Consumers will benefit from the merger through wider accelerated LTE roll out, improved quality of service and attractive and innovative pricing,” Three said.

European Parliament image via Shutterstock

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years