Vodafone Gets European Approval for Takeover of Cable and Wireless Worldwide

Published on: 3rd Jul 2012

The European Commission has cleared Vodafone's takeover of Cable & Wireless Worldwide (CWW). ­The Commission said that it has concluded that the transaction would raise no competition concerns, as the parties' activities are largely complementary. CWW's main activity is related to fixed telecoms, whereas Vodafone is mainly active in mobile telecoms.

Vodafone and CWW's activities overlap in a number of markets in the fixed and mobile telecommunications markets in the UK. However, the Commission found that the impact of the transaction on these markets is likely to be small as the combined entity would continue to face significant competition from other companies.

The transaction also gives rise to a number of vertical relationships in the fixed and mobile telecommunication markets mainly in the UK and Ireland. In particular, Vodafone would be able to use the assets of CWW in delivering fixed-mobile combined services to end-users. However, the Commission's investigation showed that the parties would not be able to shut out fixed or mobile operators from the markets for combined fixed-mobile services, because of the parties' lack of sufficient market power. Operators sell bundled fixed and mobile services via fixed or mobile resale agreements or partnerships and will still be able to do so in the future. With regard to Unified Communications ("UC") services, i.e. a set of products/services that provides a consistent unified user interface and user experience across multiple devices and media types, including fixed and mobile, there are many other competitors offering such services. Moreover, joint purchasing of mobile and fixed as one package has been the exception, rather than the rule, up to now. Finally, telecoms regulators have the possibility to, and also do intervene in some of the markets concerned and can therefore constrain the merged entity.

The Commission therefore concluded that the transaction would not significantly impede effective competition in the EEA or any substantial part of it.

The transaction was notified to the Commission on 29 May 2012.

 

Tags: [cable & wireless worldwide]  [vodafone]  [UK]