CNMC approves Zegona’s purchase of Vodafone’s business in Spain for $5 billion.

VALENCIA (EP). The National Markets and Competition Commission (CNMC) has authorized the purchase of Vodafone’s business in Spain by the British fund Zegona “without obligations”, the transaction value is estimated at 5 billion euros, the regulator said in a statement.

“The transaction consists of the acquisition by Zegona Communications (Zegona) of exclusive control of Vodafone Holdings Europe (Vodafone), which in turn allows it to gain control of its respective subsidiaries: Vodafone Spain, Vodafone ONO, Vodafone Servicios and Vodafone Energy,” CNMC provided details.

In this sense, the regulator considers that the activities of the two companies do not overlap “neither horizontally nor vertically” in Spain, given that “Zegona is not currently present” in the national market.

“The concentration operation therefore does not significantly change the structure of the affected markets, but only results in a change in the ownership of control of Vodafone in Spain,” he added.

Thus, government approval is now required to close the operation. Through the Council of Ministers on the one hand and the Ministry of Digital Transformation on the other, regarding the transfer of the relevant concessions for the private use of the public radio domain.

Authorization process

In particular, in addition to CNMC, Zegona’s acquisition of Vodafone’s business in Spain has already been approved by its shareholders, and has also gone through a procedure related to European Union (EU) rules on “foreign subsidies distorting the internal market.” The latest decision was announced last Wednesday, according to documents accessed by Europa Press.

However, the British fund believes that it does not require competition approval from Brussels to carry out the operation – as, for example, the Orange-MásMóvil merger requires and is still awaiting approval.

Regarding the European regulation on foreign subsidies that distort the internal market (Regulation (EU) 2022/2560), this regulation states that this assistance may “undermine the level playing field of competition in various economic activities” in the EU.

“This may occur in particular in the context of concentrations involving changes in the control of Union companies, where such concentrations are financed wholly or partly by foreign subsidies or where contracts are concluded in the Union with economic operators that are beneficiaries of foreign subsidies. “, the regulations say.

The European Regulation states in its Article 10 (section 4) that where, in the course of a preliminary investigation of this type, the European Commission concludes that there is insufficient evidence to initiate a full investigation – either because there is no foreign subsidy or because there are no indications actual or potential misstatement in the internal market – it must complete the preliminary check and inform the company under investigation and the Member States.

Thus, Zegona had already been informed, according to documentation accessed by Europa Press, that “there are not sufficient indications” to carry out an in-depth investigation into this European regulation, in respect of which the European Commission has examined the entrance exam.

The statement in which the CNMC announces the authorization of the operation recalls that Zegona is a company that operates as an investment vehicle in the European technology, media and telecommunications sector and which already in 2015 acquired Spanish shares in Telecable de Asturias. and then in 2017 in Euskaltel. However, in 2021, the British fund sold all its assets in Spain to MásMóvil.

“The acquired Vodafone company is a subsidiary of Vodafone Group Plc, a multinational telecommunications operator operating in 17 countries, mainly in Europe and Africa. Vodafone offers mobile and fixed-line telephony services, as well as retail television and technology services in Spain through its Vodafone company. and Lowi,” the regulator adds.