Australia Competition Regulator Blocks TPG-Telstra Network Sharing — Update

By Stuart Condie

SYDNEY--TPG Telecom said it will consider appealing to Australia's Federal Court after a second competition regulator blocked its plan to share rival Telstra's regional mobile network.

TPG said Wednesday that the Australian Competition Tribunal has declined to authorize a regional-network sharing arrangement with Telstra, Australia's largest telecommunications provider by market capitalization.

The plan would have allowed TPG to use about 3,700 additional regional mobile sites, expanding its coverage to 98.8% of the population from about 96%.

TPG said it will review the tribunal's determination before considering options for further appeal, including a judicial review in the Federal Court. TPG and Telstra took the case to the tribunal for review after the Australian Competition and Consumer Commission decided in December to block the arrangement.

"We are not giving up on regional Australia and will consider our options as well as advocating for policy reform," TPG Chief Executive Inaki Berroeta said.

The ASX-listed telecommunications providers wanted to share assets including spectrum, expanding reach and capacity for both without costly investment.

Under the agreement announced in February 2022, TPG would have decommissioned hundreds of mobile sites operating in the geographies covered by the agreement. That would have reduced pressure on asset owners such as Telstra to upgrade their facilities, the ACCC said in its December ruling.

The Australian Competition Tribunal said in its ruling that it was not persuaded by arguments that the ACCC failed to make all due inquiries related to the case. It also said it hadn't identified any aspect of the information given to the ACCC that was unclear or unintelligible and required clarification.

TPG maintained guidance for 2023 earnings before interest, tax, depreciation and amortization of 1.85 billion-1.95 billion Australian dollars (US$1.26 billion-US$1.32 billion) despite including additional transaction costs of A$20 million-A$25 million.

Write to Stuart Condie at stuart.condie@wsj.com

(END) Dow Jones Newswires

June 20, 2023 20:43 ET (00:43 GMT)

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