The Competition Commission will later today hand its report on the proposed £8.2 billion merger between Cable & Wireless Communications (CWC) and NTL to the Department of Trade and Industry (DTI). The trade and industry secretary, Stephen Byers, will then decide whether to follow the Commission’s recommendations on whether the deal should be allowed to go ahead.
The cable mega-merger was referred to the Competition Commission on the same day as the planned acquisition of a stake in BSkyB by Vivendi was handed over for investigation. However, earlier this week, the Vivendi/BSkyB investigation was extended until 24 March (see Competition Commission Extends BSkyB/Vivendi Investigation), whilst the NTL/CWC report has been completed, as scheduled, today. This has led some industry observers to suggest that the cable merger has passed through the investigation process without any problems and may therefore be recommended to the DTI to be allowed to proceed. The DTI considers reports of this nature for six to eight weeks on average.
The deal was referred to the Competition Commission by Byers despite the director general of fair trading, John Bridgman, advising against it. At the time Byers defended his concern “about the possible effects in this developing market of the reduction in the number of cable operators from three to two.”
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