The European Commission approved the acquisition of Amsterdam-based PPF Telecom by United Arab Emirates firm e&, subject to conditions, according to a Tuesday (24 September) press release.
The Commission was investigating whether subsidies given by the UAE to e& had led to negative effects on competition during the acquisition.
The influence of foreign companies in the bloc’s telecoms sector has been fuelling an ongoing debate over the sector’s investment and deregulation.
The Commission found that e& received foreign subsidies in the form of “an unlimited state guarantee,” grants, and loans. However, these “did not lead to actual or potential negative effects on competition in the acquisition process,” said the press release.
The EU executive said the UAE company was the sole bidder to acquire PPF Telecom Group, and the acquisition price reflects the market value.
PPF Telecom has activities in Bulgaria, Czechia, Hungary, Serbia and Slovakia, serving 10 million customers. Its operations in Czechia are excluded from the transaction, the Commission said.
The Commission prohibits that either e&, or the sovereign UAE wealth fund controlling e&, the Emirates Investment Authority (EIA), from financing PPF Telecom’s activities in the single market.
The Commission requires e& to inform the EU executive of future acquisitions in the telecom sector, even if they do not meet the notification requirements set under the new Foreign Subsidies Regulation.
Furthermore, in a bid to prevent e& from further benefiting from unlimited state aid, the Commission demands that e& articles of association “do not deviate from ordinary UAE bankruptcy law.”
[Edited by Alice Taylor-Braçe]
