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telecoms merger Competition watchdog takes closer look at Sunrise-UPC deal

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Sunrise, who is to buy UPC for CHF6.3 billion, expects the deal to go through in Autumn.

(Manuel Lopez)

COMCO, the Swiss Competition Commission, is to intensify its investigation of telecoms operator Sunrise’s takeover of UPC Switzerland, amid fears that the move could create positions of market dominance in several areas. 

Making the announcementexternal link Monday, COMCO wrote that “initial investigations showed that the buyout could create or reinforce a dominant position” in several markets, such as the broadcast rights of sporting events, as well as the market for the IP interconnectionexternal link of Sunrise and UPC clients.

The inquiry will be carried out within the legal timeframe of four months, which means a decision by early October at the latest. 

In a press releaseexternal link, Sunrise said that the intensified scrutiny was not a surprise. It nevertheless expects the deal to be approved, since, as it wrote, “the takeover of UPC Switzerland will intensify competition in the telecommunications market”. 

Sunrise confirmed in February this year it was in advanced negotiations to buy UPC from current owner Liberty Global for a total of CHF6.3 billion ($6.3 billion), thus tying together two of the four telecoms operators in Switzerland’s crowded market. 

The takeover would create a major competitor to state-controlled Swisscom, the biggest telecoms company in the country with CHF11.7 billion in revenue and 6.6 million mobile phone customers in 2017, out of a population of 8.4 million. 

Sunrise, by contrast, had a total of 3.4 million customers in 2017, including 2.4 million mobile phone customers, and revenue of CHF1.85 billion francs.  

UPC, meanwhile, had about 1.1 million TV customers amid falling subscriptions, and 138,000 mobile phone clients in Switzerland, company documents show.  

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