On Tuesday, the antitrust regulators of the European Union stated that the purchase of the assets of Liberty Global in Germany as well as Eastern Europe might damage the competition prevailing in Germany as well as Czech Republic.
This is because the regulators have opened a probe that is full scale into the deal which is worth $21.8 billion.
This deal between Vodafone which is the second largest mobile operator in the world and the cable pioneer in the United States, Liberty of John Malone will enable Vodafone to compete in a more effective manner Deutsche Telekom in the home market of the rival of Germany.
The deal will also expand the reach of Vodafone in broadband, cable as well as mobile services elsewhere in Europe as the deal includes the assets of the Liberty Global in the Czech Republic along with Hungary and Romania.
According to the European Commission some of the rivals in the market of Czech might shut down. In this market, Vodafone offers mainly the telephony services of the mobile and the Liberty Global offers fixed services.
The competition enforcer of the European Union stated that in Germany, this deal might reduce competition in the markets of retail fixed telecom as well as retail TV.
It will also include curb investments in the network of the next generation and will also give the merged firm extra power as a broadcaster of TV.
The enforcer saw no issues in Romania as well as Hungary and also stated that the Union will decide whether or not to clear the deal by the 2nd of May.
If Vodafone offers concessions, the deadline to this can be extended.
Reuters had reported that the watch dogs are set so as to launch a probe of full scale into the deal.
Source: Reuters, Wall Street Review
