Date set for ruling on TPG-Vodafone merger appeal

The ACCC hasn’t won a big merger court case in over a decade. It hopes a landmark ruling on the TPG-Vodafone tie-up will change that.

TPG chief David Teoh leaves a Federal Court hearing in Melbourne. Picture: David Geraghty

The proposed $15bn TPG-Vodafone merger could be cleared to proceed when the Federal Court hands down a landmark appeal ruling next Thursday.

The companies took the case to court after the Australian Competition and Consumer Commission knocked back the deal last year on the grounds that it would hurt competition in the $20 billion mobile market.

The ACCC had ruled the proposed merger was likely to prevent TPG entering as fourth player in the mobile networks market, therefore cutting competition in the sector.

The merger would combine the No 3 and No 4 players in Australia’s most important telecommunications market with more than $20bn in revenues.

TPG argues it was never really a player in the mobile market and that the government’s ban on using Huawei’s 5G equipment halted its rollout plans.

The companies argue the combination of TPG’s fixed line broadband business and Vodafone’s mobile business would be a more potent competitor to the government-subsidised Telstra.

The ACCC argues there is a real chance TPG could re-enter the mobile market.

It has noted that TPG spent $1.3 billion on mobile spectrum, which underlines its potential intent.

The ACCC has not won a big merger court case in over a decade and most lawyers expect it to lose this one.

However analyst firm Venture Insights is among observers tipping the Federal Court will rule in favour of the watchdog.