EU ready to ease telco merger rules

EU ready to ease telco merger rules

M&A Merger and acquisition business finance 16.9.jpg

EU regulators could ease rules against telco mergers to get Big Tech and others to help rollout 5G, a Reuters report indicates.

The biggest telecoms groups in Europe have frequently called for less stringent regulations surrounding mergers.

However, after Orange and MasMovil announced an alliance in 2022, it was thought that more mergers could be imminent.

A separate Financial Times report said that the EU Commission found that “fragmentation [of the sector] could impact the ability of operators to reach the scale needed to invest in the networks of the future, in particular in view of cross-border services”.

A report on digital infrastructure, setting out the thinking of the Commission on how to build digital networks is set to be published next week.

Mike Conradi, partner at DLA Piper believes that while comparisons are often made between the US (which has just 3 significantly sized mobile operators) and the EU (which has tens of them), it’s important to bear in mind that in any one EU country today there are typically just three or four mobile operators who are active.

“For this reason, mergers across countries are much less likely to be problematic than mergers within the same country.

“It will be very instructive to follow the result of the proposed merger in Spain between Orange and MasMovil, which would reduce the number of Spanish operators from 4 down to 3 and in particular to note any remedies that might be imposed on the merged entity obliging it to divest spectrum holdings to alternative providers.”

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