Federal Court clears way for TPG-Vodafone merger

ACCC bemoans TPG-Vodafone merger decision as 'lost opportunity for stronger competition'

ACCC bemoans TPG-Vodafone merger decision as 'lost opportunity for stronger competition'

A $15 billion merger between Australia's third- and fourth-largest telecommunications companies looks set to go ahead after Vodafone and TPG beat the competition watchdog in court.

Today the two companies had their day in court and have come out victorious with Justice Middleton agreeing that the merger would not reduce competition. They said that the merger would further concentrate an already concentrated Australian telecoms market and that it did not satisfy the legal test of not "substantially lessening competition".

Vodafone says it's now accelerating its roll-out of 5G networks.

He said the merger would allow the companies to compete with Telstra and Optus.

According to the AFR, Justice John Middleton ruled in his judgement there would be no great improvement to competition in having TPG and Vodafone remain as separate entities.

"Australian consumers have lost a once-in-a-generation opportunity for stronger competition and cheaper mobile telecommunications services with this merger now allowed to proceed", ACCC Chair Rod Sims said in a statement.

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'This could result in them expanding Vodafone's mobile network further into regional areas and building a fast 5G network created to compete head-to-head with the NBN, ' he told the Geelong Advertiser.

Despite announcing plans to build a network back in 2017, TPG CEO David Teoh admitted in September 2019 the company never actually had concrete, budgeted plans to do so.

TPG had planned to build a 4G mobile network to rival Vodafone's but scrapped it in 2018 due to economic and technical factors.

The merger is expected to be completed in mid-2020, subject to regulatory approvals and any appeal by the ACCC. "There is clear evidence that consumers pay more when markets are concentrated".

"We have ambitious 5G rollout plans and the more quickly the merger can proceed, the faster we can deliver better competitive outcomes for Australian consumers and businesses", he said.

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