BT’s proposed £12.5-bn acquisition of EE gets regulatory nod
29 Oct 2015
BT's £12.5-billion takeover of EE will not reduce market competition, has received a provisional nod from the Competition and Markets Authority (CMA).
According to officials, the deal would not impact the mobile phone market, where BT is a small player. They add EE's minor position in the retail broadband sector would not stop any swamping of the marketplace.
EE, Darlington's largest private employer has a 2,000-strong call centre workforce, and counts hundreds more employees at sites in Doxford, Sunderland, and Cobalt Business Park, near Newcastle.
EE earlier told, The Northern Echo that there would be immediate impact on jobs from the development.
However, according to BT, it was too early to confirm what changes, if any, would be made to North-East jobs.
With the acquisition, BT would emerge as one of the top 10 largest companies in the region, with an 8,800-strong workforce, extended scope to offer fixed-lines phones, mobiles and TV, and access to EE's 4G network, which provides users with instant internet access.
Meanwhile, the approval has drawn the ire of rivals, who had been pushing hard for parts of BT to be sold off, if the deal was to go ahead.
Vodafone and TalkTalk expressed disappointment and concern over the ruling, especially as BT was not forced to sell Openreach, which leases fixed phone lines to the mobile operators.
Pointing out that its role was to make sure customers were not affected by a lessening of competition, CMA said, ''We have… been mindful that the role of the CMA in merger cases is to protect competition for the benefit of consumers, not the commercial interests of competitors.''
According to commentators, BT will use the ruling to put its plans to tap the so-called ''quad play'' market, offering fixed line, broadband, TV and mobile phone bundles to households.
A Vodafone spokesman said, ''We strongly believe the combination of the UK's dominant supplier of digital fixed infrastructure – upon which all other providers rely – with the largest mobile operator would have a negative impact on the market.''
TalkTalk said, ''We note the CMA is divided over its findings in wholesale mobile and we will be studying these, alongside the full findings, before reporting back to the regulator in due course.''
The CMA looked into the impact of Openreach and said it was a matter for the communications regulator Ofcom, pointing out that a review of the structure of the industry was already under way.
It added, ''We have been mindful that our assessment in this inquiry is of the impact of the proposed merger, not an investigation into the industry or into the effectiveness of current regulation.
''We noted that Openreach is subject to regulation overseen by Ofcom which is designed to prevent such discrimination. We found no evidence to support third-party concerns that BT had, in the past, circumvented this regulation.''
