TeliaSonera and Telenor plan to make deeper concessions to secure European Union approval for a proposed joint venture in Denmark, because commitments submitted on Aug. 12 have reportedly failed to convince regulators.
Quoting unnamed sources, Reuters said the two operators are expected to submit revised proposals in the coming weeks. A final decision is expected by Oct. 7 after the European Commission (EC) extended the original deadline of Sept. 16 by 10 working days.
The sources suggested that the revised concessions could involve the sale of additional spectrum to Three Denmark. Reuters noted that earlier proposals, which have been seen by the news agency, already included plans to sell two blocks of 2100 MHz spectrum and rent 15 per cent of the new venture's network capacity to a new player.
Consultant John Strand told Reuters that TeliaSonera and Telenor would find it hard to attract a new player to a market where ARPU is low and contract periods are short.
"Regulators are too focused on the number of operators in national markets when Europe needs consolidation to create stronger companies more able to invest in faster networks," Strand added.
The companies announced their plan in December 2014 to combine Denmark's number two and three operators into a 50:50 joint venture. The EC in April opened an in-depth probe into the plan amid concerns over the competitive impact of the move. The EC is concerned by the fact that the merger would create Denmark's largest operator in terms of revenue and subscriber numbers, ahead of rivals TDC and Hi3G (Three Denmark).
Sweden-based TeliaSonera and Norway's Telenor have remained bullish despite the issues raised by the EC, which in June released a statement of objections to the planned combination. They have continued to say they expect the deal will be approved in the second half of 2015.
The proposed joint venture already has a management team in place, for example: Telenor executive Hilde Tonne has been appointed as CEO, while Telia Denmark's CEO Soren Abildgaard and CFO Dennis Kilian have been appointed deputy CEO and CFO respectively.
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