LONDON — Virgin Media and O2’s £31.4 billion ($44.4 billion) merger has been approved by U.K. competition regulators.
Britain’s Competition and Markets Authority said Thursday it had greenlit the deal after finding that it was unlikely to lead to a substantial lessening of competition in the telecoms market.
The CMA had earlier expressed concern that the tie-up may lead to price increases or reduce the quality of wholesale services, which it says would have negatively impacted consumers.
The watchdog said there was sufficient competition in the leased-line market from players like BT Openreach, meaning the combined company would “still need to maintain the competitiveness of its service or risk losing wholesale custom.”
At the same time, the CMA said O2 faces stiff competition in the mobile networks market.
“O2 and Virgin are important suppliers of services to other companies who serve millions of consumers. It was important to make sure that this merger would not leave these people worse off. That’s why we conducted an in-depth investigation,” said Martin Coleman, CMA panel inquiry chair.