Menu
Sky merger with Vodafone wins Overseas Investment Office consent

Sky merger with Vodafone wins Overseas Investment Office consent

Merger proposal still has to win over New Zealand's competition regulator.

John Fellet, CEO of Sky TV, which is pushing for a merger with Vodafone New Zealand

John Fellet, CEO of Sky TV, which is pushing for a merger with Vodafone New Zealand

The Overseas Investment Office has granted its consent for the proposed $3.44 billion merger of Sky TV and Vodafone.

Sky announced to the share market this afternoon that Overseas Investment Act consents had been granted for the transactions required to give effect to the proposed merger.

While the consent is good news for the companies that have been pursuing a merger since last June, New Zealand's competition regulator, the Commerce Commission, remains opposed to the deal.

"Sky and Vodafone are continuing to assess the Commerce Commission's recently released reasons for its decision not to clear the proposed merger so that they can determine their future steps in relation to the proposed merger, if any," Sky told investors today.

The Commerce Commission is concerned the combined company could use Sky's war-chest of sports broadcasting rights to win an unfair advantage in telecommunications markets.

Globally, telecommunications is rapidly converging with content services while locally the roll-out of Ultrafast Broadband provides an opportunity to dominate the emerging online content marketplace.

The Commerce Commission outlined its concerns with the proposed merger last October and subsequent submissions had not resolved these concerns, Commerce Commission chair Dr Mark Berry said in February.

“The proposed merger would have created a strong vertically integrated pay-TV and full service telecommunications provider in New Zealand owning all premium sports content," Berry said.

"We acknowledge that this could result in more attractive offers for Sky combined with broadband and/or mobile being available to consumers in the immediate future.

"However, we have to take into account the impact of a merger over time, and uncertainty as to how this dynamic market will evolve is relevant to our assessment."

The trend for bundles that package up broadband, mobile and sport content is growing, he said.

"Given the merged entity’s ability to leverage its premium live sports content, we cannot rule out the real chance that demand for its offers would attract a large number of non-Vodafone customers," he added.

Speculation that the two companies might push ahead with their merger without Commerce Commission approval emerged in press reports earlier this month.

Commerce Commission clearance is not legally required for the merger to go ahead, however, it provides some protection against future competition lawsuits and helps protect Sky and Vodafone directors from personal liability.


Follow Us

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

Tags VodafoneTelecommunicationsconvergenceSky TVzealand

Featured

Slideshows

Reseller News welcomes industry figures for 2019 Hall of Fame lunch

Reseller News welcomes industry figures for 2019 Hall of Fame lunch

Reseller News welcomed 2018 inductees - Chris Simpson, Kendra Ross and Phill Patton - to the third running of the Reseller News Hall of Fame lunch, held at the French Cafe in Auckland. The inductees discussed the changing landscape of the technology industry in New Zealand, while outlining ways to attract a new breed of players to the ecosystem. Photos by Gino Demeer.

Reseller News welcomes industry figures for 2019 Hall of Fame lunch
Upcoming tech talent share insights at inaugural Emerging Leaders Forum 2019

Upcoming tech talent share insights at inaugural Emerging Leaders Forum 2019

The channel came together for the inaugural Reseller News Emerging Leaders Forum in New Zealand, created to provide a program that identifies, educates and showcases the upcoming talent of the ICT industry. Hosted as a half day event, attendees heard from industry champions as keynoters and panelists talked about future opportunities and leadership paths and joined mentoring sessions with members of the ICT industry Hall of Fame. The forum concluded with 30 Under 30 Tech Awards across areas of Sales, Entrepreneur, Marketing, Management, Technical and Human Resources. Photos by Gino Demeer.

Upcoming tech talent share insights at inaugural Emerging Leaders Forum 2019
Show Comments