Vodafone gets European Commission approval to acquire Cable & Wireless

By Peter Gothard
06 Jul 2012 View Comments
Vodafone store

Vodafone is free to buy Cable & Wireless after gaining approval from the European Commission. The move will see the telecoms company become second to only China Mobile as the largest telecommunications company in the world.

The intended transaction, which was announced in April, was officially filed with the Commission on 29 May, and while it had been suggested that the deal might fall foul of anti-monopoly legislation, approval has apparently been granted without a hitch.

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Despite the level of market share the acquisition could lead to, the European Commission said in a statement that it had concluded that, "the transaction would raise no competition concerns, as the parties' activities are largely complementary. Cable & Wireless's main activity is related to fixed telecoms, whereas Vodafone is mainly active in mobile telecoms".

The Commission also approved the combined company's ability to "use the assets of CWW in delivering fixed-mobile combined services to end-users", while still remaining unable to shut out fixed or mobile operators due to a "lack of sufficient market power".

"Operators sell bundled fixed and mobile services via fixed or mobile resale agreements or partnerships and will still be able to do so in the future," said the report.

However, the Commission also reminded those with concerns about the deal that individual telecoms regulators "have the possibility to, and also do intervene in, some of the markets concerned and can therefore constrain the merged entity."

The Commision's decision comes on the heels of Vodafone and O2's recently announced 4G infrastructure merger, which will see the two companies go head to head with Everything Everywhere for UK dominance of high-speed mobile data networks.

A Vodafone group spokesperson was unable to provide Computing with statement or comment on the Cable & Wireless acquisition.

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