A Statement of Preliminary Issues released by the Commerce Commission suggests it is unlikely to object to the proposed acquisition of 50 percent of Vodafone by Infratil.
The Commission notes Infratil’s ownership of Trustpower, which is both a power utility and a telco, but recognises the two businesses will be kept separate. It also notes the recent resale agreement between Spark and Trustpower.
In its statement, the Commission zeros in on the likely competitive impact writing:
"The proposed acquisition would result in overlap in the supply of fixed line broadband and voice services to consumers, as well as limited overlap in the supply of those services to business customers.
“Given Trustpower’s plan to supply wireless broadband and mobile services to consumers, there are also potential future overlaps in those markets.”
The Commission goes on to say; “We will investigate whether the proposed acquisition would be likely to substantially lessen competition in the relevant market ”
It appears to accept this may not be the case as it goes on to say: “…the number and strength of existing and potential competitors in the national markets for residential broadband and voice services means that there would be no substantial difference in competitive constraint post-merger.”
The Commission also says there is negligible overlap in the business broadband market and that analysis of this is not required.
It says: “We will give clearance to a proposed acquisition if we're satisfied that the acquisition is unlikely to have the effect of substantially lessening competition in a market.”
The Commerce Commission has invited comments from the industry and says it wants to make a final decision by July 15.