Watchdog to rule on Telstra bid by September

TOM PULLAR-STRECKER
Last updated 11:57 27/07/2012

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The Commerce Commission hopes to rule on whether to allow Vodafone's $840 million acquisition of TelstraClear by September 7, but warns that timing could change.

It has released a list of the factors it will consider when weighing up whether to approve the deal.

As expected, it includes the effect on competition for fixed-line voice, broadband and mobile services as well as the implications of pooling the two companies' radio spectrum.

Most analysts forecast the commission is likely to approval the takeover, with or without some modifications, though interim Telecom chief executive Chris Quin has signalled he does not believe it is a done deal.

The commission said it would consider some issues that had not been raised by Vodafone in its takeover application, including whether the merger might reduce competition in specific regions within New Zealand and in specific markets such the small and medium-sized business market and the corporate market.

It will look at what the two companies might do if the takeover did not proceed, including whether Vodafone would be ''likely to enter the large commercial segment in the near future and whether any competition constraint from this would be lost as a result of the proposed acquisition.''

It will also consider the effect on the provision of ''bundled'' products such as triple-play phone, broadband and television services and whether the takeover might increase the chances of ''collusion'' in the industry, either tacitly or explicitly.

The impact of ultrafast broadband would also be a factor, it said.

The takeover would create a merged firm with 3200 staff. The commission invited ''interest parties'' to make submissions by August 13.

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- BusinessDay.co.nz

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