The European Commission has referred a proposed merger between Virgin Media and O2 to the Competition and Markets Authority (CMA).
Virgin Media and O2 confirmed their intention to merge back in May. Naturally, the £31 billion deal is being scrutinised by regulators.
The CMA formally requested the case be transferred on October 8th, shortly after the European Commission launched its investigation. Today, the European Commission accepted that request.
Andrea Coscelli, Chief Executive at the CMA, said:
“We welcome the European Commission’s decision to transfer the proposed deal between Virgin and O2 to the CMA for investigation.
These are incredibly important UK markets, that continue to evolve, and the deal needs to be carefully reviewed to make sure that consumers are protected.
We have worked closely with the European Commission so far and we will build on the work that has already been carried out to make sure that the case can be investigated as quickly and efficiently as possible.”
Virgin Media and O2 have called for the CMA to conclude its investigation as quickly as possible by putting it through its fast-track process.
The fast-track process would move the investigation directly into ‘Phase 2’ where a detailed investigation is conducted. ‘Phase 1’ simply determines whether further scrutiny is required or if a deal can be cleared or refused from the onset.
Merging companies, especially ones the size of the Virgin Media and O2, can request to move directly into Phase 2 in cases where it’s clear an in-depth investigation will be required.
The CMA says it expects to grant the fast-track request. The regulator has called for views on how the merger could impact competition to be submitted by 26th November but further opportunities will be available during the Phase 2 investigation.
Back in 2015, O2 and Three UK agreed to a merger—but the EU Commission blocked the deal over competition fears. The Virgin Media-O2 deal isn’t expected to face the same problems because it wouldn’t leave just three mobile networks in the market.
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