CMA raises concerns over Cellnex-CK Hutchison deal

The competition watchdog said it found evidence to suggest that CK Hutchison should have sold its passive infrastructure assets to an alternative buyer rather than market leader Cellnex

UK’s Competition and Markets Authority (CMA) has raised concerns over a UK telecom tower deal between Spain's Cellnex and Hong Kong's CK Hutchison, saying it could lead to higher prices and lower quality services for network operators.

The competition watchdog said on Tuesday it found evidence to suggest that CK Hutchison should have sold its passive infrastructure assets, including towers and masts, to an alternative buyer rather than market leader Cellnex.

Last year, Cellnex said it would buy 24,600 telecom towers across Europe from CK Hutchison, which owns the Three mobile network in the UK, for 10 billion euros ($11.81 billion).

At the time it was reported that the acquisition would add nearly 24,600 towers to Cellnex's 60,000 masts across Europe including nearly 6,000 mobile phone masts across the UK.

After the completion of Phase 1 of its investigation in May, the CMA found that the deal raises competition concerns in relation to the independent supply of passive infrastructure assets.

A sale to a firm other than Cellnex, the largest independent supplier of mobile towers in the UK, would help sustain healthy competition, the CMA said.

It's important that services provided to mobile networks remain competitive so that the millions of businesses and consumers across the UK that use mobile phones can enjoy lower prices, said Mike Walker, chief economic adviser at the CMA.

Responding to CMA's statement, a Cellnex spokesperson said the company would review the regulator's findings and work closely with it to address the concerns.

Cellnex and CK Hutchison have five working days to offer legally binding proposals to the CMA to address the competition concerns identified.