EU: Probe into Hutchison-Vimpelcom merger opened

European Union antitrust regulators have opened an in-depth investigation into Hutchison’s planned merger of its Italian mobile telecoms business with Vimpelcom’s, on concerns it could lead to higher prices for consumers.

“The Commission has concerns that the transaction could lead to higher prices, less choice and reduced innovation for mobile customers in Italy,” the European Commission said in a statement on Wednesday.

The companies said in a joint statement they had expected the deal to be investigated and would cooperate. “The combined business will have the scale, financial strength and a more efficient cost structure to offer Italian consumers and businesses a state-of-the-art network,” the statement said.

The proposed merger of Hutchison’s 3 Italia SpA and Vimpelcom’s WIND Telecommunicazioni will reduce the number of mobile network operators in Italy from four to three, a reduction which competition regulators think could lead to higher prices for users.

The transaction would also create the largest mobile operator by subscriber numbers in Italy.

The Commission has 90 days, until Aug. 10, to decide whether to approve the merger.

EU regulators have recently taken a harder line on mergers in the mobile telecoms market, casting doubt on claims that consolidation leads to higher investment in networks.

Full content: The Wall Street Journal

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