European Union buying blocks Telefonica O2 UK by Hutchison – Management Journal

The collapse of British agreement also means a setback for Telefonica, which seeks to reduce its debt, but not unexpected, as sources close to the matter told Reuters the month past that expected the deal was blocked.

(Reuters) .-regulator competence of the European Union blocked plans CK Hutchison Holdings to become the largest mobile operator in Britain, in a decision that also raises questions about whether receive approval for another agreement in Italy.

the European Commission said allowing Hutchison acquire O2 UK, which belongs to the Spanish Telefonica , for 10,300 million pounds (US $ 14.900 million) have raised prices in the industry British mobile telephony and left only two rivals: EE , recently acquired by BT Group and Vodafone.

Hutchison is also awaiting an opinion on a merger by US $ 24.800 billion between its Italian subsidiary 3 Italia and Wind, which belongs to Vimpelcom, to create a stronger rival to Telecom Italia and Vodafone.

Hutchison said she is disappointed by the decision and will consider its options, including a possible legal remedy. He also maintained that now focus on working with the Commission to ensure the approval of the proposed merger between Wind and 3 Italy.

The collapse of British agreement also means a setback for Telefonica, which seeks to reduce its debt, but not unexpected, as sources close to the matter told Reuters last month that it expected the deal was blocked.

in September there was a precedent, when the telecommunications companies TeliaSonera and Telenor abandoned a merger in Denmark after the curator of European Competition Margrethe Vestager, said he considered that the domestic market needed to have at least four network operators competing in the country.

Telefonica said last month it had several options for O2 UK if the agreement with Hutchison failed, among which were the possibility of finding another buyer for all or part of the business, trading on the stock market, or make a greater investment in the subsidiary.

on Tuesday, the Cable group Liberty Global said that it would consider buying O2 UK if Brussels blocked the deal, but said that values ​​the flexibility of its current strategy of being a virtual mobile operator.