OFT OKs C&W's Energis buy
PrintNo competition probe
Posted in Financial News, 25th October 2005 16:24 GMT
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The UK’s Office of Fair Trading has waved through Cable & Wireless’ takeover of rival telco Energis.
The OFT announced this afternoon that C&W’s takeover of Chelys Ltd, Energis’ owner, will not be referred to the Competition Commission.”
“We do not believe that Cable & Wireless could impose higher post-merger prices on CPS (carrier pre-selection) customers, because of the number of credible competitors to which CPS retailers can turn to supply them with wholesale services,” the body said.
The deal will now move ahead, meaning C&W can follow through on its plan to assemble a serious competitor to British Telecom, and reduce its reliance on BT’s infrastrucure.
When it announced its bid for Energis back in August, C&W said it would pay £594m in upfront cash for Energis, followed by £80m in cash or shares three years after the deal is completed. C&W will also inject £35m into the Energis business, to cover short-term working capital requirements.®
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