KPN takeover of Reggefiber to face competition investigation

News Broadband Netherlands 7 MAY 2014
KPN takeover of Reggefiber to face competition investigation
Dutch competition regulator ACM said it plans a further investigation of KPN's proposed increase in its stake in FTTH operator Reggefiber. In February KPN announced it would exercise an option to increase its stake from 51 to 60 percent, allowing it full control and consolidation of Reggefiber. Due to the change in control of the company, the conditions imposed on Reggefiber by the regulator in 2008 in terms of network management would no longer be valid, the regulator said. 

The ACM said the KPN takeover could lead to reduced access for other operators to KPN's fibre assets, so a new investigation is needed, and possibly new conditions on the company as well. It will look at whether other providers on the fibre network could be excluded after the takeover or face more restrictive conditions for access. The investigation coincides with the ACM's analysis of the overall telecom market, conducted every three years. 

KPN first acquired 41 percent in Reggefiber when the joint venture with investment company Reggeborgh was set up in 2008. Through a series of options based milestones in the number of homes passed by the network, the operator has gradually increased its stake. Only with the latest step to 60 percent will KPN have full control over the network planning. The next option to acquire the remaining 40 percent can be exercised at the earliest in July 2017. 

Vodafone issued a statement following the ACM's announcement, saying it welcomes the investigation. Vodafone provides services over the Reggefiber network. The operator said it was concerned that it could be more difficult for KPN's rivals to provide services over the fibre network after the takeover. Investment in the network could also slow, with fewer new homes passed, as KPN focuses on exploiting its older copper network, which has suffered from competition from FTTH. Vodafone said it was important that competition continues to develop on the network of the future, as competition over fibre is the best way to give consumers a choice in terms of quality and price. 

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