Merger of Ardian and Míla approved with conditions
The Icelandic Competition Authority (ICA) has completed its investigation into the acquisition of Ardian France of all shares of Míla, a subsidiary of Síminn. Míla operates telecommunications infrastructure nationwide in Iceland and is the largest and most important wholesaler of telecom services in Iceland. Síminn is the largest retailer of telecom services in Iceland and, thus, the largest buyer in wholesale. Ardian is a France-based, independent private equity investment company.
Consequently, it is of great importance to the Icelandic economy and consumers that Síminn's sale of Míla is managed in a way that does not harm competition in the vital markets in question.
ICA considers the changed ownership of Míla and its detachment from Síminn a positive step for competition in the telecommunications market. On the other hand, along with the sale, the parties involved made a long-term wholesale agreement which would have created unprecedented barriers to competition. In addition, telecoms systems and wholesale operations were transferred to Míla in relation to the merger, reinforcing and potentially strengthening Míla's position. The abovementioned concerns called for ICA's intervention.
With a settlement signed on September 15th, ICA has approved the merger with conditions. The settlement entails substantial changes to the wholesale agreement between the parties involved. In addition, Míla has committed to certain conditions for its operation, and Síminn has signed a statement on the company’s disintegrated operations and commercial independence. With those commitments, ICA believes the potential harmful effects and barriers to competition have been sufficiently removed or limited, laying a solid foundation for healthy competition for the good of consumers, businesses, and the community.
Páll Gunnar Pállsson, Director General at the Icelandic Competition
Authority:
"Competition in the construction and operation of infrastructure has secured the country a favorable position on the field compared to others. In the transition times that lie ahead, it will be decisive for Iceland's competitiveness that the government and industry foster competition in this area.
The entry of an independent infrastructure investor into the Icelandic market and the severing of the ownership relationship between Síminn and Míla are suitable for fostering competition if things are handled well. In order for this to happen, the conditions and terms of the transaction must support competition. The settlement presented here is intended to ensure that."
The settlement, in Icelandic, can be found here.
For further information or requests for comments, please contact Haukur Harðarson (haukur.hardarson@samkeppni.is).