ACCC to decide on TPG-Vodafone merger in May

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ACCC to decide on TPG-Vodafone merger in May

The Australian Competition and Consumer Commission will make its decision on the proposed TPG-Vodafone merger in May.

It's the third time the commission has rescheduled the decision date, delaying it by five months longer than anticipated and eight months after the merger’s announcement.

TPG and Vodafone in August 2018 announced they will merge to form a $15 billion entity in a bid to better compete with market leaders Telstra and Optus.

Following an initial 12-week review, ACCC chairman Rod Sims raised concerns over competition, saying TPG and Vodafone would be competitors upon the arrival of 5G.

“Our preliminary view is that TPG is currently on track to become the fourth mobile network
operator in Australia, and as such it’s likely to be an aggressive competitor,” Sims said at the time.

“The merged TPG-Vodafone would not have the incentive to operate in the same way, and competition in the market would be reduced as a result. A mobile market with three major players rather than four is likely to lead to higher prices and less innovative plans for mobile customers.”

The decision date was then moved to 28 March 2019 to allow for the telcos to respond to the ACCC’s concerns. Delays in getting responses pushed the decision date to 11 April, and again for 9 May.

The proposed merger will create a company with more than 27,000km of fibre networks, 5000 sites, and at least 8 million subscribers across Australia. The combined group will be renamed TPG Telecom Limited.

TPG and Vodafone also signed a separate joint venture to acquire, hold and licence 5G spectrum. The joint venture eventually shelled out $263 million for 131 lots, second behind Telstra’s $386 million for 143 lots.

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