BT’s takeover of EE, the UK’s largest mobile network, has been granted provisional approval by the Competitions and Markets Authority (CMA).
The CMA said it's satisfied that the deal will not negatively impact on competition in the UK’s broadband and mobile sectors, meaning the takeover is much closer to being rubber-stamped by Ofcom.
The regulator noted that concerns over how rivals would cope in the face of such a large new company had been allayed to its satisfaction and cited BT's current status as a comparatively small player in the mobiles market as evidence.
However, the CMA admitted it was less certain what the tie–up would mean for Mobile Virtual Network Operators (MVNOs). These are smaller mobile providers who rent larger networks’ infrastructure and aim to undercut the big players.
A number of MVNOs claim that BT’s purchase of EE could adversely affect their business. TalkTalk says it would limit the choice of networks from which MVNOs can hire infrastructure and would give BT/EE too much clout.
BT’s deal for EE comes as Three owner Hutchison Whampoa looks to close a £10.5 billion merger with O2, potentially further restricting MVNO access.
BT Chief Executive Gavin Patterson said: "We're pleased that the CMA has provisionally approved BT's acquisition of EE.
"The combined BT and EE will be good for the UK, providing investment and ensuring consumers and businesses can benefit from further innovation in a highly competitive market."