Telia Faces Extended EU Probe Into Bid for Bonnier TV Operations
(Bloomberg) -- Telia Co. faces an extended European Union investigation into its 9.2 billion-krona ($960 million) bid for Bonnier AB’s television operations over concerns the deal may reduce choice and increase prices for TV services in Finland and Sweden.
The European Commission set a Sept. 19 deadline to rule on the deal, saying its initial investigation showed Bonnier may be able to shut off its channels from rival TV platforms. The merged firm could also deny access to TV ad space to Telia rivals and could deny access to streaming apps to customers using competition Internet and mobile providers. Bonnier’s channels are "very important" for TV distributors to offer, the EU said.
A longer probe raises the risk that companies may have to sell off units or make pledges on future behavior to placate rivals and customers. Failure to make such concessions can lead to an EU veto. Telia’s expansion plans have run into trouble with EU antitrust regulators before. Telia and Telenor ASA’s plan to merge their Danish mobile-phone units was called off when the EU threatened to block the deal over a risk it would increase prices.
Closely held Bonnier AB owns TV channels in Sweden and Finland, and with the deal Telia is emulating U.S. and European peers who have added content to their traditional phone services to combat powerful digital rivals such as Netflix Inc. and Amazon.com Inc. Like AT&T Inc.’s deal to buy Time Warner Inc. in the U.S., Telia becomes both a distributor and producer of content with the Bonnier acquisition.
Telia’s purchases are the latest in a string of major deals in the Nordics that are reshaping the telecom and media landscape. Telia’s Danish competitor TDC A/S earlier this year moved to buy TV and online streaming assets from Sweden’s Modern Times Group AB, in a deal that fell through when TDC was bought by a consortium led by pension funds.
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