October 18, 2012 / 7:46 PM / 5 years ago

EU's Almunia wants Hutchison to sell spectrum for Orange Austria deal

TRIER, Germany (Reuters) - Hong Kong’s Hutchison 3G will need to sell assets such as spectrum to soothe regulatory worries about its planned 1.3 billion euro buy of France Telecom’s Orange Austria, the EU’s antitrust chief said on Thursday.

The comments by EU Competition Commissioner Joaquin Almunia underlined his concerns that the merger would reduce the number of telecoms operators in Austria from four to three.

Hutchison, a unit of Hutchison Whampoa, which is controlled by Hong Kong billionaire Li Ka-shing, has already offered to open its network to rivals at cost price. It has signed an agreement with Liberty Global’s cable operation UPC.

Almunia said additional concessions were needed.

“We like structural remedies, sale of spectrum,” Almunia told Reuters at the sidelines of a conference organised by the Academy of European Law.

Hutchison, the smallest telecoms provider in Austria, sought on October 8 to persuade Commission officials and national competition regulators of the merits of the takeover during a closed-door hearing. Almunia’s comments suggested he was not convinced.

Telekom Austria is the No. 1 operator in that market, followed by Deutsche Telekom’s T-Mobile.

The proposed merger is considered by telecoms operators as a test case for the Commission’s stand on consolidation in the sector, which some argue needs scale in order to boost investment in costly broadband and mobile networks.

Vodafone and KPN have criticized the regulator’s competition approach towards mergers in the industry.

Reporting by Foo Yun Chee; editing by Rex Merrifield

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