EU: No leeway for telecom sector mergers, says Commission

The European Commission dashed hopes on Thursday of leniency for mergers within the telecommunications industry as Cecilio Madero, deputy director-general for antitrust at the regulator, offered a frank remark regarding the subject at a conference. The official stated that even if telecoms were to request leniency for proposed deals, there is not enough evidence the support may of their claims that operators’ investments would rise in response to growth from merger deals. According to reports, the request for merger leniency is likely a response to increased pressure on the companies who are struggling to keep up their infrastructure and meet demands of a society dependent on smartphones and tablets that use more data. Teleco companies across Europe have been struggling with four straight years of revenue declines, say reports, and are now looking to break the trend with big-deal mergers. Vodafone, Orange and KPN have all expressed the need to become part of acquisitions in their efforts to finance network and infrastructure investments, but the Commission, as reiterated by Madero, is not convinced that mergers will allow companies to increase their investments.