Austrian Merger of Hutchison 3G and Orange Facing Competition Concerns

­According to the European Union’s Commissioner for Competition, Joaquin Almunia, the merger of the Austrian mobile networks, Hutchison 3G and Orange probably will not be approved.

Hutchison 3G Austria has offered a number of concessions to secure the purchase, but it is being opposed by the rival networks. There are competition concerns as the market would shrink from four to three companies following the takeover.

Earlier this year, Hutchison 3G agreed to pay EUR1.3 billion for Orange Austria, which is 35% owned by France Telecom and 65% by the private equity investors, Mid Europa Partners (MEP).

In a speech, Joaquin Almunia said that: “We are looking very carefully into this proposed merger and we have recently raised objections against it. At this stage, the question remains whether effective remedies will be found to clear this merger.”