Vodafone, Liberty offer concessions to secure EU approval of Dutch deal

Vodafone and Liberty Global submitted concessions in an effort to secure European Union (EU) approval for a proposed merger of their respective businesses in the Netherlands.

The European Commission (EC) said it received "commitments" on Jul. 12 without giving further details. The commission also noted that an Article 9 request was received on Jul. 5, 2016, which presumably refers to an attempt to request a referral of the case to the Dutch Authority for Consumers and Markets (ACM).

The EC has set a deadline of Aug. 3 to reach a provisional decision on the proposed deal. The commission is also expected to issue the outcome of an initial review by Jul. 19.

Options available include opening a full-blown investigation into the merger proposition or approving the deal. If the EC chooses the latter option it must decide whether or not to impose conditions.

The proposed 50-50 joint venture between Vodafone Netherlands and Liberty Global's Ziggo cable broadband network would create the second largest telecoms service provider in the country behind KPN, with some 4.2 million video, 3.2 million broadband, 2.6 million fixed-line telephony, and 5.3 million mobile subscribers.

T-Mobile Netherlands is the market's third mobile operator and faces an uncertain future because of its inability at present to compete in the area of converged fixed and mobile offerings. Deutsche Telekom, which is generally following a convergence strategy in Europe, is understood to have unsuccessfully attempted to sell the unit in 2015.

Inspired by the success of the more prosperous T-Mobile US, Deutsche Telekom and T-Mobile Netherlands in June launched a new three-year strategy for the Dutch mobile unit under the "Mobile First" banner, including a brand strategy called Live Forward and a new management board. The current CEO, Mark Klein, is to leave the company in September in order to take up the position as chief digital officer at German insurance company ERGO Group AG. The new CEO is expected to be announced soon.

Meanwhile Liberty Global CEO Mike Fries previously said that there are no plans to extend the cooperation with Vodafone beyond the Netherlands, quashing rumours of a bigger relationship between the two groups. He also said Liberty did not plan to add new countries in Europe, but did intend to expand operations in countries where it is already present, including Poland.

For more:
- see the EC merger case
- see this Reuters article
- see this Deutsche Telekom release

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