The Norwegian Competition Authority (NCA or Konkurransetilsynet) has warned TeliaSonera and Tele2 Norway that it is considering blocking their merger. It said the remedies submitted by TeliaSonera with a view to ending NCA's concerns are insufficient.
Director General Christine Meyer said TeliaSonera's acquisition of Tele2's operations in Norway involves two of the three largest players in mobile telephony in the country. She said the Norwegian mobile telecommunications market is already highly concentrated and the deal reduces the number of mobile network operators from three to two. The NCA fears that the acquisition will harm the competition climate. The result is likely to be higher prices and lower quality for consumers.
The NCA said that issuing this statement of objections does not prejudge the final outcome of its investigation into the transaction. The parties may present their views on the objections within fifteen working days. After that date, the NCA may use another fifteen working days to reach a final decision on the merger. The deadline for the parties' reply to the NCA's objections is 22 December 2014 and the deadline for a final decision by the NCA is 15 January 2015.
Robert Andersson, head of the Europe region at TeliaSonera, said the company would analyse the authority's objections carefully and then continue the dialogue. Mats Granryd, president and CEO of Tele2, said rejecting the deal would potentially jeopardise the creation of a dynamic mobile market in Norway with two strong competitors to the incumbent. He said Tele2 and TeliaSonera would evaluate the statement and respond with appropriate actions.
TeliaSonera announced its intention to buy Tele2 Norway for SEK 5.1 billion in July. At the same, time TeliaSonera committed itself to 98 percent population coverage by 4G by 2016, two years earlier than required, provided that the acquisition was approved by the authority. Faster LTE roll-out would be possible by the synergies created by the acquisition of Tele2 Norway, it said. Telia runs the Netcom grid in Norway.
