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ISLAMABAD: The Competition Commission of Pakistan (CCP) has completed all cordial formalities of Phase-II review of Pakistan Telecommunication Company Limited’s (PTCL) acquisition of 100 percent shareholding in Telenor Pakistan Pvt Ltd and Orion Towers Pvt Ltd.

Valued at $400 million, the transaction stands as one of the most significant mergers in Pakistan’s telecom sector, involving both vertical and horizontal market expansions.

Sources told Business Recorder that CCP officials are expected to meet with PTCL management next week. PTCL’s acquisition of Telenor Pakistan, which includes Telenor’s mobile and broadband services and Orion Towers’ infrastructure assets, has attracted significant attention across the telecom industry, with various stakeholders weighing in on its potential impact.

The CCP’s scrutiny of the transaction was rigorous, with multiple hearings held throughout September and October 2024 to evaluate the deal’s implications. The Commission, chaired by Dr. Kabir Ahmed Sidhu, engaged with stakeholders from across the telecom sector. It listened to their concerns and assessed the potential impact on market dynamics. The Commission intends to increase market efficiency while ensuring that competition remains fair and consumer interests are protected.

PTCL’s acquisition of Telenor, Orion Towers: CCP told there are no immediate competition concerns

The CCP’s detailed review included a close examination of the transaction’s effect on key telecom submarkets, including Long Distance and International (LDI), Local Loop Operators (LLO), Telecom Infrastructure, Mobile Network Operators and domestic leased lines and IP bandwidth.

During the series of open hearings, conducted by CCP, it was learnt that the merger would significantly reshape market shares across several telecom sectors. Notably, PTCL that holds 50.5 percent of the retail LDI, fixed-line market, will control 61 percent of LDI market after said accusation.

In the mobile telecommunications sector, PTCL’s Ufone share of 12.4 percent will merge with Telenor’s 24 percent share, creating a new entity holding 37 percent of the market. Additionally, PTCL will dominate wholesale IP bandwidth and domestic leased lines, controlling 68 percent and 42.7 percent, respectively, following the transaction.

During the hearings, CCP Chairman Dr Sidhu emphasized that the Commission’s main focus is to prevent any anti-competitive outcomes that could negatively impact consumers. The Commission has been evaluating the merger from both legal and economic perspectives. It is considering the overall market health, consumer outcomes, and the long-term effects on competition in Pakistan’s telecom sector.

While PTCL has strongly defended the merger, stating that it would lead to greater competition, investment in infrastructure, and enhanced service quality, other telecom players have expressed reservations.

Wateen Telecom has raised red flags about the merger’s potential to stifle competition in critical infrastructure-related markets, including Long Haul IRU Services and Co-location Services. Wateen has also warned that PTCL’s dominance could lead to customer foreclosure, limiting access to key services for competitors, particularly in the inbound voice services market.

Jazz (PMCL) has voiced conditional support for the deal but has called for regulatory safeguards to ensure that PTCL’s expanded market power does not negatively affect consumers. Jazz cautioned that the merger could lead to a significant market share increase for PTCL, especially in regions like Azad Jammu and Kashmir and Gilgit-Baltistan, where consumer choices are already limited.

CM Pak (Zong) expressed concerns over spectrum concentration, with the potential for Merge Co to control up to 34.4% of the total spectrum in the retail mobile market. Zong emphasised that this could give the new entity an unfair advantage in coverage and service quality, especially in underserved regions.

The Commission’s final decision will depend on maintaining robust market competition to benefit consumers and the broader economy. While the merger will strengthen PTCL’s market position, it also has the potential to create new investment opportunities and improve the country’s digital infrastructure and network coverage, officials added.

Copyright Business Recorder, 2024

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Saeed Nov 22, 2024 12:44pm
CCP please say no this is establishing a worse kind of oligopoly
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Aamir Nov 22, 2024 06:44pm
I want to some information About telenor microfinance bank From Syed Aamir Abbas ex branch Manager Telenor bank Rahim yar khab branch 026
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Ramzan Nov 23, 2024 11:26pm
sports kro yaar viral video nice
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Zaib khan Nov 26, 2024 01:26am
Love u Telenor and ptcl
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Ahmed Nov 26, 2024 09:03am
After such merger, what will be competition? PTCL-Ufone already revised their Packages prices, same followed by other telcos; so what will be the competition and consumer rights?
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