El Salvador imposes conditions on Millicom’s acquisition of Caribeña
Details
Juan Fernandez Gonzalez
| 04 July 2017

El Salvador’s competition authority Superintendencia de Competencia has asked Millicom’s Tigo to accept a set of specific conditions before giving the go-ahead to its buyout of local cableco Caribeña.

The conditions imposed on Tigo’s subsidiary Telemóvil include the obligatory deployment of a hybrid fibre network (HFC), such as Tigo owns in other parts of the country, in order to improve Caribeña’s pay-TV offering and service quality across the east of the country.

In addition, Tigo cannot hinder users’ ability to change pay-TV providers and can’t sell any bundled service that would give its own products an advantage over the competition.

Other conditions include the need to directly informing Caribeña’s current client base about the deal and the prohibition of unreasonable price increases or reduction of offerings.

The Superintendencia de Competencia will also monitor the resulting company in order to prevent negative effects on competition.

“Analysis of the deal has revealed a major risk to the pay-TV market, as it will eliminate one competitor and will strengthen Telemóvil’s dominant position,” stated the competition authority.

However, the acquisition will benefit competition in other telecom markets, which is why the Superintendencia de Competencia has decided to green light the operation on the condition that Tigo agrees upon the special clauses.