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New Zealand’s Sky TV is rumoured to be going ahead with its merger plan with telco giant Vodafone’s New Zealand offshoot, despite not winning the legal approval from New Zealand’s competition regulator.
The country’s Commerce Commission ruled against the merger plan in February, but has subsequently said that its clearance was not formally required but had instead would have provided a level of assurance that the two companies involved could not subsequently be sued for anti-competitive actions.
Without that approval there are risks, but it seems that investors are happy to take their chances. Sky’s shares rose 12 per cent in trading May 2nd.
The scheme would see Sky TV buying Vodafone NZ, and paying ongoing management fees and charges for using Vodafone’s cellular network in New Zealand.
The Commerce Competition’s decision not to endorse the deal was largely based on anxieties that Sky TV would dominate the market over premium sports, and thus gain an unfair advantage.