Bad connection

11 May 2016 By Fiona Maharg-Bravo

Despite blocking the purchase of the UK’s O2, Margrethe Vestager claims she doesn’t have a one-size-fits-all approach. The UK market does have idiosyncrasies, and the antitrust tsar raised legitimate concerns. But Brussels is hardening its stance on the risks from consolidation.

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Europe competition commissioner Margrethe Vestager rejected CK Hutchison’s 10.3 billion pound takeover of Telefonica’s British O2, citing strong concerns that UK mobile customers would have had less choice and paid higher prices, and that the deal would have harmed innovation in the mobile sector.

“We had strong concerns that consumers would have had less choice finding a mobile package that suits their needs and paid more than without the deal,” Vestager said in a statement.

The European Commission said the takeover would have hampered the development of mobile network infrastructure in the UK and reduced the number of mobile network operators willing to host other mobile operators on their networks.

Hutchison said it was deeply disappointed by the decision, and was considering its options, including the possibility of a legal challenge. Telefonica, meanwhile, says it will stick to its financial objectives and dividend policy.

Telefonica shares were down by more than 1 percent at 9.26 euros a share when markets closed.

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“We had strong concerns that consumers would have had less choice finding a mobile package that suits their needs and paid more than without the deal,” Vestager said in a statement.

Telefonica shares were down by more than 1 percent at 9.26 euros a share when markets closed.

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