Portugal blocks Vodafone’s takeover of Nowo
July 8, 2024
From Branislav Pekic in Rome
Portugal’s competition regulator, Autoridade da Concorrência (AdC), has shot down Vodafone Portugal’s attempt to acquire telecom company Nowo.
The AdC fears the merger would hurt consumers by limiting competition in the Portuguese telecom market, by increasing market power for Vodafone and its main competitors (Meo and NOS), creating conditions for coordinated offers among them, and making it harder for new players to enter the market.
According to the antitrust body, Nowo exerts considerable competitive pressure on the other market operators, while a potential merger would lead to significant price increases.
AdC rejected Vodafone’s proposed solutions, which included selling spectrum rights to Digi and offering them wholesale access to Vodafone’s fibre network. The regulator believes these are not enough as they wouldn’t address the core competition concerns.
Vodafone said it is reviewing the decision, stating they don’t understand the reasoning behind the rejection, especially considering Nowo’s small market share (less than 2 per cent).
Back in September 2022, Vodafone struck a deal to acquire Nowo, Portugal’s fourth-largest telecom provider, from Spain’s Masmovil.
Vodafone provides fixed and mobile communications, fixed and mobile internet services, and pay-TV services in Portugal. It has national network coverage and provides services using its own or third-party infrastructures.
Nowo offers fixed voice, mobile telecommunications (as an MVNO, where it uses Altice’s network), broadband internet access, and pay-TV services in mainland Portugal. Nowo recently obtained, through the 5G auction, frequency spectrum that will allow it to develop its own mobile telecommunications network.
According to data from the National Communications Authority (Anacom), Vodafone was the third-largest player in the pay-TV market in Portugal in Q1 2024 with a 19.3 per cent share, while Nowo was fourth with 2.7 per cent.