Norway's regulator puts Telia's Phonero deal on ice

Bill Boyle
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The Norwegian competition authority is considering blocking Telia’s attempted acquisition of Phonero

In light of the regulator's decision to reconsider the Telia acquisition of Phonera, Telia will now consider the judgement and respond to the authority.

It has been reported in the Norwegian press that the Authority has blocked the deal because it is worried that it could reduce competition and increase costs, particularly for enterprise customers.

The notice to Telia is not a final decision, and the firms involved have fifteen days to comment. Then the authority has a further fifteen days and a final deadline of early April.

The authority said it was considering scuppering the deal because it the two biggest players in the corporate mobile segment. Telia and Telenor Norway are the two biggest players. In the corporate segment, however, Phonero is a challenger which has gained a lot of market share, said the authority’s director general for competition, Lars Sorgard. He is giving the impression the regulator thinks that competition is being squeezed out of the market.

Telia was obviously disappointed with the decision. “We disagree with the competition authority’s preliminary notice and we are very surprised by their assessment of the dynamics of the Norwegian enterprise segment. If their decision stands, only the dominant operator in the market will benefit”, says Abraham Foss, CEO of Telia Company’s Norwegian operation.

Telia Company’s market share in the enterprise segment is currently 13%. This would increase to 26% through the acquisition of Phonero.

“We firmly believe that the acquisition would provide a clearer alternative while also strengthening competition in the enterprise segment. There will be no real competition in the Norwegian enterprise segment until the dominant operator is properly challenged”, said Abraham Foss.

Telia Company will now assess the preliminary notice and respond to the authority within the timeframe that they have set.