BRUSSELS--The European Commission Thursday rejected a renewed
request from Germany's competition authority to review Telefonica
Deutschland AG's (O2D.XE) proposed acquisition of E-Plus, the
German unit of KPN Mobile NV (KPN.AE).
The commission said it was "better placed" to review the 8.6
billion euros ($11.6 billion) deal because of its "experience in
assessing mergers in the mobile telecommunications sector" and the
need for a consistent application of European Union merger
rules.
The decision had been expected since the commission said last
month it was launching a detailed probe into the deal, thereby de
facto rejecting an initial request by Germany's antitrust body, the
Federal Cartel Office, to review the merger.
Telefonica Deutschland, Germany's fourth-largest mobile network
operator and a unit of Telefonica SA, formally asked the commission
in late October to approve the deal. It needs antitrust approval
because the merger would reduce the number of mobile operators in
Europe's largest telecoms market to three from four and would make
the combined entity Germany's market leader by number of
customers.
German regulators asked to review the deal themselves in
November, arguing that it affected only the national market. The
German cartel office sent a renewed request to the commission on
Jan. 2., a spokesman for the cartel office told The Wall Street
Journal earlier this month.
The commission said it has until May 14 to take a final decision
on whether to approve the merger.
Write to Tom Fairless at tom.fairless@wsj.com
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