Photographer: Matthew Lloyd/Bloomberg

Hutchison's U.K. Deal Gets Phone Feedback at EU Hearing

  • Vodafone, Iliad among 10 firms said to speak on Three-O2 bid
  • Hutchison aiming to win over EU at closed-door hearing

CK Hutchison Holdings Ltd. sought to persuade European Union competition regulators to back its plan to create the U.K’s biggest mobile phone business as rivals and customers flocked to an EU hearing on the proposal.

Firms including Vodafone Group Plc as well as French operator Iliad SA headed to Brussels as Hutchison, owned by billionaire Li Ka-Shing, seeks to overcome EU antitrust objections to the bid to merge its Three unit with Telefonica SA’s O2.

Monday’s hearing gave Hutchison “the opportunity to have another fruitful exchange” with EU regulators and European government officials, it said in an e-mailed statement. The takeover, bolstered by Hutchison’s pledges to invest in its network and to avoid mobile-phone price increases for five years “will make the U.K. mobile market truly competitive.”

Hutchison’s promise is separate from any offer it makes to allay EU antitrust concerns. Regulators often demand tough concessions before clearing mobile phone mergers. TeliaSonera AB and Telenor ASA’s attempt to merge their Danish units collapsed in the face of EU opposition last year.

Pay-TV giant Sky Plc, TalkTalk Telecom Group Plc, BT Group Plc and Liberty Global Plc were also among firms due to speak for 10 minutes each, according to a person familiar with the agenda, who asked not to be named because the hearing isn’t public. Others scheduled to talk are Dixons Carphone Plc, Tesco Plc’s mobile phone unit, UKB Networks Ltd. and Gamma Communications Plc.

Concessions, Opportunity

Such concessions are a business opportunity for many; Liberty Global entered the Irish and Austrian markets after Hutchison agreed with the EU to aid so-called mobile virtual network operators that lease network space to offer mobile-phone services to customers.

While the U.K. has a large number of MVNOs, some are anxious about how the deal may affect the terms they’re offered if there are fewer networks to choose from. Virgin Mobile Holdings UK Ltd. and Tesco Plc’s MVNOs have more than 5 million customers, according to MVNO Dynamics, an industry website.

The hearing gives Hutchison a chance to deflect possible antitrust concerns over the deal, valued at more than 9 billion pounds ($12.7 billion.)

For TalkTalk, “it’s important for us to attend and to hear the arguments” in a deal that affects the U.K. mobile phone landscape, said Isobel Bradshaw, a spokeswoman for the company in London.

Tesco said in an e-mailed statement that it wanted to ensure that “challenger brands such as Tesco Mobile can continue to grow, develop and deliver the best possible service to U.K. customers.”

Other than TalkTalk and Tesco, most of the companies had no immediate comment on the hearing.

Ofcom, the U.K.’s telecoms regulator, is also attending the meeting. Its CEO, Sharon White, has been openly critical of how the deal might increase prices for consumers. Ofcom declined to comment when contacted Monday.

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