Telecom regulator gives limp OK to True and DTAC merger

Telecommunications regulators voted by a slim margin to approve the merger of the country’s second and third largest mobile operators, with conditions. 

After a 10-hours meeting, the National Broadcasting and Telecommunication Commission said a majority of members – 3 to 2 – had “acknowledged” the merger between True Corp. Pcl and Telenor ASA’s Total Access Communication Pcl – a deal first announced nearly a year ago.

The commission, however, said that it will specify conditions as the merger is a “sensitive” matter that  “impacts the public.” 

Massive DTAC, True merger to seek regulators’ blessing

The conditions include price caps and controls. An independent verification of rate structures and service fees for at least five years was also stipulated. The service rates – such as voice, data, and messaging – must be shown separately and based on average cost pricing.

The commission also demanded that the True Move H Universal Communication – True’s mobile business unit  – and DTAC’s equivalent, Dtac Trinet, must operate separately for three years. 

The merger of True and DTAC would leave Thailand with only two major operators. The combined entity, which would become the market leader, and its rival, Advanced Info Service.

Pirongrong Ramasoota of NBTC, who did not vote in favor of the merger, cited that the merger would have a wide impact on the mobile service market in terms of reducing or limiting competition, consumer protection and the country’s economic development. 

The majority stake of True Corp – up to 49% – is owned by Thai agri-industrail conglomerate Charoen Pokphand (CP).

“One of the applicants has close business ties with a big conglomerate,” Pirongrong wrote on her Facebook after a Thursday meeting. “There is an opportunity for them to expand the market by using a collective sales strategy, resulting in unequal competition with other operators.”

Other conditions include requiring an independent verification of cost structure and service fee for at least five years. Service rates such as voice, data, messaging must be shown separately and based on average cost pricing.

Massive DTAC, True merger to seek regulators’ blessing

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