The Commerce Commission today cleared Telecom Corporation of New Zealand Limited to acquire the assets and businesses of Cellnet Mobile Services Limited.
Commission Chairman Peter Allport said that the Commission was satisfied that the proposed acquisition would not result in Telecom acquiring or strengthening a dominant position in the market for the distribution of cellular services in New Zealand.
Cellnet is a Telecom accredited service provider (TASP) owned by Fisher and Paykel Industries Limited. As a TASP it distributes cellular connections to, and airtime on, the Telecom cellular network.
The Commission found that existing competition, the success of Bell South New Zealand in increasing its market share, the lack of substantial entry barriers and the recent entry of another strong and committed competitor in Telstra New Zealand Limited, mean that Telecom is not currently dominant in the cellular distribution market.
The Commission found that the removal of Cellnet from the market would have little impact on competition. As a TASP, Cellnet is essentially part of Telecom's competition with other companies, rather than a strong competitor to Telecom.
The Commerce Act prohibits business acquisitions that result in dominance being acquired or strengthened in any markets. Parties can apply for a clearance, which will be granted if the Commission is satisfied that dominance is not acquired or strengthened.
Media contact: Commerce Act Manager Jo Bransgrove
Phone work (04) 498 0958
Communications Officer Vincent Cholewa
Phone work (04) 498 0920
Commission media releases can be viewed on its website www.comcom.govt.nz
