Vodafone signs broadband deal with Telefonica Deutschland amid competition probe
Vodafone will grant Telefonica Deutschland access to its broadband network in a bid to stave off competition concerns over its $22bn (£16.8bn) takeover of Liberty Global assets.
The telecoms firm today said rival Telefonica will be able to market broadband services to its customers using the combined cable network of Vodafone and Liberty’s Utilitymedia if the merger is approved.
Read more: Vodafone calls on German government to speed up fibre optic rollout
The move is part of Vodafone’s efforts to increase competition in the German market after the European competition commission raised concerns about the firm’s acquisition of Liberty’s businesses in Germany, the Czech Republic, Hungary and Romania.
“The cable agreement will enable us to connect millions of additional households in Germany with high-speed internet in the future,” said Markus Haas, chief executive of Telefonica Deutschland.
“By adding fast cable connections, we now have access to an extensive infrastructure portfolio and can offer to even more O2 customers attractive broadband products for better value for money.”
The deal, which has been signed on a long-term basis, will give Telefonica access to a network that covers almost 24m households in Germany.
EU competition regulators last year launched an investigation into the mega-merger, which is Vodafone’s largest deal since its £112bn takeover of Mannesmann.
Rival operator Deutsche Telekom has complained the acquisition would damage competition in the sparsely-populated German market, while antitrust concerns have also been raised in the Czech Republic.
But the European Commission looks set to give the green light to the deal, as investigators are yet to identify any major problems with the merger, according to local media reports.
“Our deal with Liberty Global is transformational in many ways,” said Vodafone boss Nick Read.
Read more: Vodafone set to receive EU competition warning over Liberty deal
“It is a significant step towards a gigabit society, which will enable consumers & businesses to access the world of content and digital services at high speeds.”
The EU is expected to carry out market testing of the deal and issue a final decision by July.