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Hutchison's €1.3B Orange Austria bid faces T-Mobile challenge

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Less than two weeks after clearing what appeared to be the last legal hurdle in a long regulatory battle, Hutchison Whampoa is facing a new obstacle that could derail its planned acquisition of Orange Austria. T-Mobile Austria, which has sparred with Hutchison over the deal, filed an appeal with Austria's higher administrative court to block the transaction.

In late December, Austria's competition authority gave the green light to Telekom Austria's acquisition of Orange Austria Yesss unit, thus clearing the way for a wider consolidation of the Austrian mobile telecoms sector. The sale of the unit was a condition of Hutchison's €1.3 billion deal to buy Orange Austria and merge it with 3 Austria, reducing the number of players on the Austrian market from four to three.

However, T-Mobile Austria has appealed the allocation of radio frequencies that would result from the takeover of Orange Austria, over fears that rivals will have a head in building LTE networks. Telekom Austria is set to acquire frequencies from Orange as part of the €390 million deal to buy Yesss.

The competitive nature of the Austrian market means that any disadvantage held by a major network operator could have serious repercussions on its ability to attract subscribers. T-Mobile's spectrum would be less suited for the construction of an LTE network, and the operator believes it would therefore fall behind in the LTE race.

Hence T-Mobile Austria wants an injunction that could delay or even derail Hutchison's Orange Austria purchase. The Deutsche Telekom subsidiary has requested that the transfer of spectrum be put on hold while its case is being heard. T-Mobile expects the court to decide within days whether to grant an injunction in the case, according to Reuters.

For more:
- see this Reuters article
- see this separate Reuters article

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