BT completes EE acquisition; Openreach still an issue

BT Group said on Friday that it has completed its £12.5bn acquisition of mobile network operator EE.

However, the deal still faces a challenge in the form of industry regulator Ofcom, which is currently investigating whether BT should be made to spin off its Openreach arm on competition grounds.

The Competition and Markets Authority gave the deal the green light earlier this month, saying it was unlikely to hurt competition.

John Wotton, who chaired the CMA inquiry into the deal, said: “Since our provisional findings, we have taken extra time to consider responses in detail but the evidence does not show that this merger is likely to cause significant harm to competition or the interests of consumers."

“The retail mobile services market in the UK is competitive, with four main mobile providers and a substantial number of smaller operators. As BT is a smaller operator in mobile, it is unlikely that the merger will have a significant effect. Similarly, EE is only a minor player in retail broadband, so again it is unlikely the merger will have a significant effect in this market.”

Last week, a report backed by 121 MPs concluded that BT should be made to sell Openreach in order to increase competition.

“We believe that Britain should be leading the world in digital innovation," the report said.

"Yet instead we have a monopoly company clinging to outdated copper technology with no proper long-term plan for the future."

At 1131 GMT, BT shares were up 2% to 475.55p.