[Vodafone to bide time ahead of possible ACCC appeal to tie-up]


Vodafone to bide time ahead of possible ACCC appeal to tie-upSkip to sections navigationSkip to contentSkip to footerVodafone Hutchison Australia will hold off on utilising the massive amounts of spectrum it has acquired through its $15 billion merger with TPG in case the competition watchdog appeals a ruling that approved the tie-up.Vodafone’s local boss Iñaki Berroeta was taking a cautious approach on Thursday despite the Federal Court finding in its favour and overturning a decision by the Australian Competition and Consumer Commission (ACCC) to block the merger after Justice John Middleton found it would not substantially lessen competition and thus harm consumers.Vodafone Hutchison Australia boss Inaki Berroeta was all smiles on Thursday after the court threw out a decision by the ACCC to block its merger with broadband player TPG. Credit: Louie Douvis”We will not do anything jointly until this thing is fully clear and we are able to combine both companies together,” Mr Berroeta told analysts on a call following the decision.”We do have standalone 5G plans and that’s what we’re working on,” he said.The ACCC will have several weeks before it has to decide whether to launch an appeal against the ruling which left the chairman of the regulator Rod Sims saying he was “disappointed”. Mr Sims told The Age and The Sydney Morning Herald it was too soon to say whether the watchdog would appeal the decision until its lawyers had read the court ruling. If the ACCC appeals, it will be several months before the outcome is known.TPG owns two times10 MHz of the 700 MHz spectrum, which it intended to use to build a fourth mobile 4G network before abandoning its plans when the federal government banned its preferred technology provider Huawei for security reasons. The merger means that Vodafone would be able to use that spectrum to further develop its network.”What 5G gives us is the opportunity to deliver more to the customers in a very different way,” Mr Berroeta said.”5G does allow for additional services and additional revenue and this where I think the opportunity for 5G comes, much more than charging a higher access fee.”The amount of traffic that 5G will carry in the next couple of years still will be limited. So we also need to take into consideration the capacity that we provide for the main service, 4G,” he said.LoadingMr Berroeta appeared to indicate that Vodafone would not be aggressive on pricing to build market share immediately following the merger.”I think in our ‘go to market’ (strategy) we need to focus on our own customers and to leverage on the strength of different brands to address the needs of our different customers,” Mr Berroeta said.”A big part of our strategy is how do we leverage on the joint customer basis. On one side we have TPG with 2 million households, a lot of those households could be using the mobile services of the new entity, and at the same time we have roughly 6 million customers with mobile which in some circumstances have broadband but with TPG we have the ability to significantly increase our presence there.”Mr Sims said on Thursday afternoon he expected the merged entity would not disrupt the status quo and for there to be a similarity between the pricing of the three top players.”I’m not at all surprised that there is an impression that they are not thinking about aggressive pricing – I’m fairly certain they’re not,” Mr Sims said.Mr Berroeta will lead the merged entity, while TPG executive chairman David Teoh will be the combined group’s non-executive chairman. Vodafone will own 25 per cent of the newly merged group while Hutchison will own the other 25 per cent. Both groups have agreed to not sell down their stake for two years after the scheme is approved. The reclusive Mr Teoh declined to be interviewed but in a statement he welcomed the merger.”We will work to finalise the other conditions to the merger as soon as possible,” he said. The judgment sent TPG’s shares soaring, with the stock closing up 11.5 per cent to $8.15.Most Viewed in BusinessLoading


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