Infratil, Brookfield cleared to buy Vodafone NZ
New Zealand infrastructure investment company Infratil and Canada’s Brookfield Asset Management have secured the required approvals to jointly acquire Vodafone New Zealand for NZ$3.4 billion ($3.25 billion).
New Zealand’s Commerce Commission has signed off on the proposed acquisition, and the Overseas Investment Office has approved Brookfield’s participation in the agreement. The deal has now become unconditional, and the acquisition is expected to close at the end of the month.
The Commerce Commission had been evaluating whether Infratil’s planned acquisition of up to 50% of Vodafone would substantially lessen competition in the broadband market. Infratil holds a 51% stake in Trustpower, an electricity retailer that also offers broadband bundles.
Infratil has already asserted that it plans to continue to operate Vodafone and Trustpower as separate companies, but the Commission conducted its investigation on the assumption that the two businesses could be combined in the future.
Commerce Commission Chair Anna Rawlings said her agency is satisfied that Infratil’s proposed shareholding in both Vodafone and Trustpower would not substantially lessen competition in any of the markets examined.
“While Trustpower has in the past been an aggressive competitor in residential broadband, with a particular focus on energy and broadband bundles, several other multi-utility providers have similarly emerged including Vocus, Nova Energy and Contact Energy. 2Degrees and Stuff are also competing effectively in the residential broadband market alongside Spark and MyRepublic,” she said.
“As it stands, Vodafone and Trustpower are not each other’s closest competitors and, even in regions where they would hold high market shares, such as Bay of Plenty and Wellington, they will continue to face effective competition from several other national operators.”
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