Hutchison wins conditional EU approval for Orange Austria deal

BRUSSELS Wed Dec 12, 2012 10:15am EST

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BRUSSELS Dec 12 (Reuters) - Hong Kong's Hutchison 3G secured EU regulatory approval on Wednesday for its planned 1.3 billion euro ($1.69 billion) buy of France Telecom's Orange Austria after agreeing to sell radio spectrum and open up its network to new rivals.

The European Commission ruling will be a relief to the telecoms sector, where operators had worried that regulators would frown on mergers reducing the number of competitors in national markets.

Analysts said four-player markets like Germany and Spain were ripe for consolidation that could help to offset falling sales and profits.

The European Commission, which acts as the competition authority in the 27-member European Union, said in a statement that Hutchison 3G's proposals addressed its concerns.

"The risks posed by more concentration in national mobile telephony markets cannot be ignored," EU Competition Commissioner Joaquin Almunia said.

"The commitments proposed by H3G ensure that competition is preserved so that Austrian consumers continue to enjoy the benefits of innovation and fair prices."

Hutchison, a unit of Hutchison Whampoa, which is controlled by Hong Kong billionaire Li Ka-shing, promised to sell radio spectrum and other rights to new entrants, the EU antitrust authority said.

It also promised wholesale access for competitors to its network, allowing up to 30 percent of its capacity for up to 16 mobile virtual network operators (MVNOs) in the next 10 years.

It will have to seal at least one deal before completing the takeover.

Hutchison is the smallest telecoms provider in Austria. Deutsche Telekom's T-Mobile is the No. 2. ($1 = 0.7693 euros) (Reporting by Foo Yun Chee; editing by Rex Merrifield)

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