Sunday, April 25, 2010

Switzerland - Competition authority blocks the merger of Orange and Sunrise to avoid them having a dominant position

[wsj] The Swiss Competition Commission Thursday blocked the planned merger of the Swiss units of France Telecom (FT) and Danish peer TDC A/S, saying a merger would hurt the market dynamics in the country's mobile phone market.

"Together with Swisscom, the merged company would have a market-dominating position in the Swiss mobile telephony market," the regulator said.

Swisscom is Switzerland's largest telcommunications player.

TDC and France Telecom last November agreed to merge their Swiss operations--Orange and Sunrise--in a deal which would have given the French partner a 75% stake in the new entity, while TDC would haved received EUR1.5 billion from the French firm.

The Swiss regulator said that although cost synergies from the merger might have benefited clients, these potential cost savings were too low compared to the expected competition slowdown.

It added that the current market situation with three players allows that "a certain competition dynamic" remains in place, which should also allow to further innovation in Switzerland.

Swiss Regulator Blocks Merger Of TDC, France Telecom

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