The Commerce Commission in New Zealand has given clearance for Vocus Communications to acquire up to 100 percent of the shares and/or assets in M2 Group for $3 billion.
As reported by Computerworld New Zealand in September, Vocus Communications proposed merger with M2 Group aims to create more rather than less competition due to a strong wholesale division which helps small Internet Service Providers.
Both Vocus and M2 are Australia based providers of telecommunications services with extensive operations in New Zealand, with the Commission satisfied that the acquisition will not have, or would not be likely to have, the effect of substantially lessening competition in the affected markets.
“While both Vocus and M2 provide calling, broadband and data services to residential and commercial customers, they are not close competitors for any of the services that they provide,” says Dr Mark Berry, Chairman, Commerce Commission.
“We also consider that strong competition will continue to be provided by Vodafone, Spark and Chorus.”
The Commission also considered whether merging Vocus’s national fibre optic backhaul network with M2’s retail calling and broadband services would give it the ability to foreclose downstream competitors.
“Given the presence of Spark, Vodafone and Chorus, which all have large backhaul networks, we did not consider that foreclosure would be likely,” Dr Berry adds.
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