CCP Advances Telenor-PTCL Merger to Final Phase [Updated]

The Competition Commission of Pakistan (CCP) has advanced the merger application of Telenor Pakistan with PTCL to the next phase, granting the essential preliminary approvals required for the merger to proceed.

As reported by ProPakistani, the proposed merger between Telenor and PTCL has successfully passed the initial review by the CCP and has now entered the second and final phase.

Following this phase, the antitrust body is expected to provide final approval for the merger.

Industry insiders suggest that if the CCP intends to reject a merger, such a decision typically occurs during the first phase. The progression of the Telenor-PTCL merger to the second phase strongly indicates a likely approval.

The first phase is critical as it assesses the post-merger market dynamics, potential impacts on consumers and other industry stakeholders. Advancing past this phase suggests that the CCP believes the merger is unlikely to adversely affect market competition significantly.

It is noteworthy that a similar procedural path was followed in the Warid-Mobilink merger, which also moved to the second phase after initial approval.

The CCP’s notes from the first phase approval of the Warid-Jazz merger had highlighted concerns about potential competition elimination, which closely mirrors the concerns noted in the Telenor-PTCL merger’s documentation. However, these concerns are the basis of moving the application to phase 2 for more deliberation.

Not to mention, PTCL applied with CCP for a merger with Telenor earlier this year.

An outcome of this mandatory approval from CCP is expected within the next two months, after which the merger application will move to the Pakistan Telecommunication Authority (PTA) for other needed regulatory approvals.

Not to mention, the entire length of the merger of both companies could take up to 18 to 24 months after PTA’s green light.

Update:

In a statement on Wednesday, PTCL said CCP has successfully concluded Phase 1 of its review of PTCL’s acquisition of Telenor Pakistan.

This strategic transaction, involving the consolidation of telecom services, marks a significant development in the telecommunications sector for the growth and improvement of services for the customers, the statement added.

It said that owing to the size of the transaction as well as impact on market competition, CCP has decided to undertake a more detailed assessment in Phase 2 of the review process. This decision also aligns with CCP’s precedence for evaluating Mergers & Acquisitions within the telecom industry. PTCL, a leading telecommunications provider, expresses confidence in the review process and hopes for expeditious final clearance and is actively cooperating with CCP, providing comprehensive information and documentation to facilitate a thorough evaluation.

As the telecom landscape evolves, PTCL reaffirms its dedication to innovation, customer satisfaction, industry best practices and also to further advance the ambition of the company towards the betterment of the customers, the company as well as to the economic growth and digital transformation journey, the statement added.

PTCL said that for the customers in particular, the benefits revolve around various domains including superior network coverage in both urban and rural areas by combining the networks of two operators. The consolidation will result in accelerated growth and improvement in broadband services. It will also boost 4G services as well as increase data speeds resulting from combining the data capacity / spectrum of both networks.

The company said this strategic initiative will also offer customers added convenience through improved accessibility, achieved by expanding touchpoints such as company-operated service centers, increasing the footprint of channel partners, and significantly expanding retail presence. Additionally, customers will benefit from an expanded product portfolio, offering a wider range of products from both companies.

The collaboration between the two companies will expedite innovation, leveraging a larger customer base to develop more innovative and experiential products. Moreover, the combined entity will possess greater capacity to invest in future technologies to offer customers enhanced offerings, the statement said further.

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  • It’s just a formality. Merger is bound to happen and it will happen in next two months after phase II analysis. Many large countries have only 2-3 operators only that too with cut through competition. India has only 3 companies Jio, Airtel and Vi. USA has only 3 Sprint, T-Mobile and Verizon. China also has only 2. The kind of ARPU countries like Pakistan has, there shouldn’t be more than 3 companies.


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