The European Commission gave the go-ahead for Vodafone to merge with Ziggo, the Liberty Global’s Dutch operator.
The new company will be a 50/50 joint venture between the two companies. The news about a possible merger was first announced last February.
In a joint statement, Vodafone and Ziggo welcome the approval, which contains one commitment – the sale of the consumer fixed business from Vodafone (Vodafone Home), which offers fixed telephony, broadband access and TV activities. Vodafone Home has a customer base of over 122,000 customers, a growing market share in fibre and high triple play penetration.
“This represents a structural remedy offered by the parties to address any concerns regarding the overlap between the fixed telecoms and TV activities of Vodafone and Ziggo in the Netherlands. Having already received a number of expressions of interest, the parties will now proceed with the sale process,” the two companies said.
The Commission had concerns that the proposed transaction would have eliminated the benefits brought to the Dutch telecoms market by Vodafone’s recent entry. Indeed, absent the merger, Vodafone had the potential to become a strong competitor in the provision of fixed line and fixed-mobile multiple play services to consumers. According to the Commission, the divestment offered by Vodafone fully addresses these concerns, allowing the Commission to clear this telecoms merger in Phase I.
“The telecoms market is of strategic importance for our digital society. I am pleased that we have been able to approve the creation of the joint venture between Vodafone and Liberty Global in the Netherlands. The commitments offered by Vodafone ensure that Dutch consumers will continue to enjoy competitive prices and good choice,” Margrethe Vestager, EU antitrust commissioner, said in a statement.
The Commission has also rejected a request from the Netherlands to refer the merger to the Dutch competition authority for assessment under Dutch competition law. In July, the authority (ACM) requested to rule over the proposed merger.
The new JV does not have to open up its network to third parties.
