BT gets green light from CMA for proposed £12.5bn EE takeover

BT Group's proposed takeover of mobile network operator EE was given the green light from the Competition Market Authority (CMA) on 15 January after the watchdog concluded a six-month investigation into the £12.5bn ($18bn, €16.5bn) deal.

The approval, granted unconditionally without remedies, was largely expected after the CMA published a series of provisional findings late in 2015, before the watchdog took some more time to consider the views of customers and competitors.

"The merger is not expected to result in a substantial lessening of competition in any market or markets in the UK, including in relation to the supply of retail mobile, wholesale mobile, mobile backhaul, wholesale broadband and retail broadband services," the CMA said in a statement.

The decision paves the way for the FTSE 100 to acquire the joint venture between Deutsche Telekom and France-based Orange SA, and BT said it expects to complete the deal by the end of January.

By acquiring EE, the UK's largest mobile operator controlling almost a third of the market, BT said it will be able to offer so-called "quad play" – a package including fixed phone, TV, mobile and broadband – to its customer base.

As part of the inquiry, the competition watchdog focused closely on whether a merger between BT and EE would impact the way the newly formed company would provide services to its rivals. According to CMA chairman John Wotton, however, those concerns proved to be unfounded

"In supplying services such as backhaul, wholesale mobile or wholesale broadband services a combined BT/EE would not have both the ability and the incentive to disadvantage competitors such that there would be significant harm to competition," he said.

In 2015, a number of telecom providers, including Sky, objected to the proposed merger on the basis that BT's Openreach business, which provides services for rivals in the telecoms sector, should remain independent.

"We have heard wider concerns about the sector, including about Openreach and its regulation by Ofcom," said Wotton.

"Our job has been to examine the specific impact of this merger on competition and consumers and, where relevant, we've looked at how these issues might be affected by the merger.

"There is also an ongoing Ofcom review into the sector and its future regulation, where such concerns may have more relevance."