Feb. 3 (Bloomberg) -- Hutchison Whampoa Ltd. and Telekom Austria AG’s purchase of Orange’s Austrian mobile-phone assets may have to be amended to win European and Austrian approval, the country’s Federal Competition Authority said.
“There is a reduction to three operators, which diminishes competition,” Stefan Keznickl, a spokesman for the regulator, said by phone from Vienna. A precise analysis is still pending because the companies haven’t notified the authority, he said. “Based on the deal as it seems to be shaped right now, it’s hard to imagine it will be approved.”
Hutchison is buying the Austrian business from France Telecom SA and Mid Europa Partners in a deal valued at 1.3 billion euros ($1.7 billion). Some Orange Austria assets, including mobile carrier Yesss!, will be sold to Telekom Austria Group for 390 million euros after the purchase, Hutchison said.
Hutchison expects to complete the purchase in the middle of this year. The company’s shares rose to the highest level in five months in Hong Kong trading on optimism the purchase may improve its ability to compete against market leaders Telekom Austria and Deutsche Telekom AG’s T-Mobile Austria.
The two transactions that are part of the Orange deal have to be notified separately to regulators in Brussels and Vienna, Keznickl said. According to EU antitrust rules, Hutchison’s purchase of Orange must be filed with the European Commission, while Telekom Austria’s Yesss! acquisition must be filed in Austria, he said.
Deutsche Telekom AG needed eight months to gain EU approval for its purchase of Tele.ring Telekom Service GmbH, which was Austria’s fourth-biggest operator, after signing the deal in August 2005. It had to sell transmission stations and frequencies to competitors including Hutchison’s Austrian unit to overcome an EU threat to block the deal.
--With assistance from Aoife White in Brussels. Editors: Robert Valpuesta, David Risser.
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