Bulgarian competitors cry foul over United Group acquisitions

Subsidiaries of United Group are involved in a string of Bulgarian telecoms acquisitions but A1 Group and PPF Group think they shouldn’t be allowed.

Both A1 and PPF have published their concerns following the decision of the Bulgarian Commission on Protection of Competition (CPC) to allow Vivacom, which is owned by United, to acquire Networks-Bulgaria as well as six other smaller Bulgarian telcos. The move would apparently give Vivacom control of around 60% of the Bulgarian TV distribution market and 40% of its ISP market.

A1, which has a Bulgarian subsidiary, announced it is ‘deeply unsettled’ by the decision, adding: “This development further adds to the apprehension surrounding the regulatory decisions, as it reinforces the potential for the creation of a dominant player in the Bulgarian telecom marketplace, which poses significant disadvantages for the consumers.

“What is happening is particularly worrying in the light of the forthcoming decision to acquire the biggest broadband operator – Bulsatcom. According to publicly available information, this transaction is an attempt by United Group to acquire control of Bulsatcom’s operations without notification to the CPC and under suspicion of some other legal infringements.”

The second paragraph is in reference to a recent bid by Slovenia Broadband, which is part of United Group, to buy assets from Bulsatcom. A1’s apparent concern is that, through small acquisitions involving different subsidiaries, United can develop a dominant position in the broader Bulgarian telecoms and media market without objection from regulators.

PPF Telecom Group, which owns Yettel in Bulgaria, shares these concerns, expressing ‘dismay’ at the CPC decision. Bulgaria’s Commission for the Protection of Competition, in a move that we believe contradicts accepted European norms and practices, has approved a set of transactions that will lead to enormous concentrations of market share and power in the hands of Bulgarian telecom operator Vivacom and its ultimate owner, United Group,” said the PPF statement.

Both A1 and PPF indicated they intend to appeal to the European Commission over the matter. United doesn’t seem to have publicly responded to their complaints but it presumably sees things somewhat differently. You would expect European regulators to have a clear sense of how much of a given market should be allowed to be owned by a given entity and it seems reasonable to group all United subsidiaries together in making that calculation.

Get the latest news straight to your inbox. Register for the Telecoms.com newsletter here.