• EU antitrust complaint listing concerns could come in June
  • Separate U.K. deal may be vetoed by EU as soon as next week

The European Union is preparing to send CK Hutchison Holdings Ltd. and VimpelCom Ltd. a statement of objections cataloging antitrust concerns over their 21.8 billion-euro ($24.7 billion) deal to create Italy’s largest wireless provider by customers, according to three people familiar with the matter.

EU regulators are expected to issue the document in June, laying out its concerns about how the 50-50 venture could hurt competition in Italy, the people said on condition of anonymity as the EU review is confidential. The European Commission opened an in-depth probe into the pact last month over worries it could increase prices and reduce choice for customers.

While being sent a statement of objections increases the risk that deals can be blocked, most big mobile phone industry tie-ups in recent years have faced such a filing. Companies can overcome potential antitrust issues by selling units or making agreements that aid smaller rivals.

The EU is taking a tougher line on mobile-phone mergers and is expected to formally block Hutchison’s bid for Telefonica SA’s U.K. phone business as soon as next Wednesday after the companies failed to make convincing concessions to placate regulators. A Danish mobile deal also collapsed last year in the face of EU opposition.

Hutchison and VimpelCom declined immediate comment. The commission declined to comment. The authority has a deadline of Aug. 18 to rule on the deal.

Telecommunications markets in Italy, the U.K. and Denmark are all different, EU Competition Commissioner Margrethe Vestager told reporters last week. Regulators will focus on whether a deal will harm consumers, she said.

The Italian transaction, like the deal in the U.K., will reduce the number of telecommunications operators in the country from four to three. While the EU doesn’t have a “magic number” for how many wireless providers there should be, it doesn’t think smaller virtual operators offer the same kind of competition, she said.

Hutchison’s Italian deal would unseat Telecom Italia SpA as the biggest mobile phone carrier by customers. The venture would pool the assets of 3 Italia, an asset of billionaire Li Ka-shing’s Hutchison, and VimpelCom’s Wind Telecomunicazioni, the companies said when they announced the deal in August.

The Italian deal would create a carrier with more than 31 million customers and 6.4 billion euros in 2014 sales. The companies are targeting annual savings of 700 million euros as they try to create a stronger and more efficient rival to Telecom Italia and Vodafone Group Plc’s local unit.

CK Hutchison shares rose 1.3 percent to HK$95.80 during early trading in Hong Kong on Thursday. VimpelCom slipped 0.5 percent to $3.72 in New York on Wednesday.

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