BT has called on regulators to make a fast-track decision on its planned £12bn takeover of EE, the UK’s largest mobile phone network.
Britain’s biggest telecoms and broadband network announced in February that it wanted to buy the owner of country’s most-advanced 4G mobile system. But the acquisition plan has unsettled rivals, who want the former national operator broken up.
The deal will be vetted by the Competition and Markets Authority, which said on Monday it was launching its merger investigation. In their joint submission, BT and EE asked the regulator to move straight to a detailed phase 2 investigation, without losing time on preliminaries, because it will “allow the CMA efficiently to consider any complex issues in depth without delay and offers a shorter end-to-end review period compared to the CMA’s usual processes”.
Under UK competition law, mergers are scrutinised by competition authorities in two phases. The first usually takes 40 days, a period when the CMA can clear a merger outright, approve it subject to conditions, or request a more detailed investigation if it fears a substantial lessening of competition. Most large mergers usually go to a detailed phase 2 investigation by the CMA board.
If the CMA agrees to BT’s request to be fast tracked, it is expected to announce the decision within three weeks.
This streamlined process was used when competition authorities examined the merger plans of Thomas Cook and the Co-operative Group’s travel business. The merger of the high-street travel agents was eventually approved in 2011. Global Radio, the UK’s largest commercial radio station, also made use of the fast-track procedure when it sought approval to buy GMG Radio. This investigation by competition authorities resulted in a demand on Global Radio to sell off some stations.
BT hopes to get its deal approved without having to change the terms, although rivals want the CMA to take a closer look. Vittorio Colao, the chief executive of Vodafone, has said BT should be made to spin off its broadband network, Openreach. TalkTalk and Sky recently called for a breakup of BT when the telecoms regulator Ofcom announced the biggest review of the industry for a decade in March.
These rivals, and other interested parties, now have one week to make submissions on whether the BT-EE deal should be subject to a fast-track process, with a consultation closing on 26 May.
In its submission to the regulator, BT also stepped up its defence of the proposed deal.
“BT’s acquisition of EE will be good for consumers, businesses and UK plc, as well as for BT shareholders, so we are keen to get regulatory clearance,” said Gavin Patterson, its chief executive. “A larger BT will be able to invest and innovate even more than now, something that’s good for jobs and good for customers.”
The company said it expected the deal to be complete by the end of next March.
