Exclusive: Hutchison rules out more EU concessions to secure O2 – sources

Daily Mail says has not submitted bid for Yahoo’s internet assets
April 20, 2016
Microsoft to stop production of Xbox 360
April 20, 2016
This post was originally published on this site

Ck Hutchison Holdings (0001.HK) will not offer EU regulators further concessions to secure a takeover of Telefonica’s (TEF.MC) O2 and is ready to challenge a rejection of its bid in court, sources familiar with the matter said.

The Hong-Kong-based group still hopes to persuade the European Commission of the merits of its 10.3 billion pound ($15 billion) attempt to become Britain’s biggest mobile operator, reducing the number of players from four to three. Although talks between Hutchison and Brussels are still going on, Hutchison will not offer any concessions beyond those which it has already, the sources told Reuters on Wednesday.

“Hutchison has gone out of its way to offer substantial remedies for the O2 deal. It will fight in court if EU regulators want to block the deal,” one source familiar with the talks said, a position confirmed by another source.

A Hutchison spokesman declined to comment on the deal, which if it goes ahead, is expected to pave the way for consolidation in other European markets, including Italy where Hutchison and Vimpelcom agreed last year to merge their mobile units.

The EU antitrust watchdog is likely to decide in the coming weeks whether or not to block the O2 deal, with a formal decision expected by May 19.

But Telefonica, which bought O2’s assets in Britain, Germany and Ireland in 2005, is already working on a contingency plan to cut debt and appease ratings agencies if the deal with Hutchison falls through, one of the sources said.

Telefonica declined to comment.

The source said a wide range of options were being looked at, but did not include a fire sale of O2 or a dividend cut.

(Additional reporting by Paul Sandle; Editing by Alexander Smith)