Davina Garrod Quoted in Global Competition Review on Proposed UK Telecom Merger
Akin Gump international trade partner Davina Garrod has been quoted by Global Competition Review in the article “DG Comp sends CK Hutchison/Telefónica UK to Phase II,” regarding the proposed takeover of Telefónica’s O2 by CK Hutchison.
A deal between the two companies would create the UK’s largest mobile network operator, and the European Commission (EC) has said it has concerns about higher prices, fewer choices and reduced innovation for consumers. Should the merger go ahead, the number of mobile network operators in the UK would be reduced from four to three.
Garrod said there are several important distinctions between this proposed deal and last month’s abandoned deal in Denmark between TeliSonera and Telenor. The competitive landscape in the UK, she said, “is different from the Danish one, with a more vibrant virtual network segment” that includes large media companies with robust subscriber bases that could be moved to new mobile networks.
In addition, Garrod noted that the spectrum overhang would be “as pronounced as in Denmark, where Telenor and Telia had a pre-existing infrastructure [joint venture] from which efficiencies were already being realized.”