Liberty Global Plc’s Telenet unit faces an in-depth probe into its bid for Royal KPN NV’s Belgian mobile-phone business as European Union merger regulators added the tie-up to its list of telecommunications deals subjected to close scrutiny.
A combination of Telenet and BASE may trigger higher prices and less choice, reducing incentives to compete against Proximus SA and Mobistar SA in the Belgian retail mobile market, the European Commission said in a statement on Monday. It set a Feb. 18 deadline for a ruling on the deal.
“We want to make sure that consumers in Belgium do not suffer higher prices and less choice as a result of this proposed takeover,” said EU Competition Commissioner Margrethe Vestager.
TeliaSonera AB and Telenor ASA were forced to scrap last month the merger of their Danish businesses amid European Commission opposition of a deal that would have reduced the number of competitors from four to three. Vestager warned Friday that merging phone companies can’t rely on arguing that benefits from greater investment will trump the effects of removing a competitor from the market when they seek antitrust approval for deals.
The EU regulator said the combination could hamper access to BASE’s mobile network for virtual operators. The commission will also investigate whether deal would increase Telenet’s ability to sell its fixed line services to BASE’s mobile customers by bundling them together, the Brussels-based regulator said.
Liberty Global said it remains confident the deal will be cleared, according to an e-mailed statement. KPN representatives didn’t immediately respond to requests for comment.
Amid the Telenet probe, the commission will also have to decide whether to fend off a bid from U.K. regulators to vet CK Hutchison Holdings’ plan to acquire Telefonica SA’s O2 unit in the country. The Brussels-based commission generally rejects such requests, as it develops ground rules for mobile-phone competition.