The watchdog fears price rises if Vodafone acquires minnow Nowo while stc has been unable to agree terms with Altice Group on deal to buy incumbent MEO for €8bn
Vodafone Portugal’s desire to expand by acquiring Nowo Communications for a modest €150 million has been blocked by the country’s regulator, the Autoridade da Concorrência (AdC).
Nowo Communications, formerly known as Cabovisao, is the country’s fourth-largest operator. The AdC ruled against its acquisition by Vodafone after a protracted investigation. Vodafone announced its plans to acquire Nowo in 2022.
The regulator’s long report on why the acquisition would have been a bad thing boils down the finding that the combined entity would impede competition and harm consumers. Apparently Nowo acts as a brake on price increases by its three larger rivals – Vodafone, Nos and MEO, part of the beleaguered Altice Group (see below).
AdC attached particular importance to this during the ongoing cost of living crisis.
Vodafone combined with Nowo would still have been the second largest operator behind the incumbent MEO, formerly Portugal Telecom.
Vodafone isn’t the only one having a hard time getting a deal done in Portugal. Patrick Drahi, who controls the Altice Group, has been trying to sell MEO for more than a year to help pay off the group’s €60 billion or so debt, acquired when Drahi was building his empire and money was cheap.
It has been reported that the Saudi operator group stc and Xavier Niel’s Iliad Group were the last two potential bidders, with stc seen as the frontrunner, reportedly prepared to stump up €8 billion. However local media suggests that stc has pulled out of the bid as the two parties could not agree on terms.
Earlier this week, MEO signed a deal with Nokia to upgrade its RAN infrastructure.