updated 01:10 pm EST, Mon March 1, 2010
Orange UK, T-Mobile UK merger approved
The merger of telecom firms Orange UK and T-Mobile UK has been approved by the European Commission with certain limits. As a result of antitrust concerns related to the deal, the deal requires that a change is made to a current network sharing agreement with 3 UK. The amendment will involve divesting a quarter of the combined spectrum of the two merging companies in the 1,800MHz band, one of three frequency bands used for cellphones in the UK.
Thanks to the changes, the UK Office of Fair Trading (OFT) withdrew its request for the UK Competition Authorities to review the merger. Had the deal gone through without any changes, many industry players were concerned that 3 UK would lose viability in the market as it would become the smallest provider in the UK. With the merger, there will only be four major cell providers left in the country. The newly formed merger would have the majority of the 1,800MHz spectrum, which would make it the only company ready to offer LTE-based 4G networks.
It's not clear how soon Orange and T-Mobile will formalize the merger now that immediate legal hurdles have been cleared.