New Zealand Regulator Blocks Sky Network Television, Vodafone Deal

   By David Winning 
 

SYDNEY--Sky Network Television Ltd. (SKT.NZ) said Thursday that New Zealand's antitrust regulator won't approve its proposed 3.44 billion New Zealand dollar (US$2.47 billion) merger with the local operations of Vodafone PLC (VOD.LN).

In a regulatory filing, Sky Network Television said the New Zealand Commerce Commission "concluded that it cannot be satisfied that the merger would not substantially lessen competition."

Sky Network Television had pursued a deal with Vodafone to offset a loss of customers to digital rivals. The Auckland-based company's traditional pay-television business is under pressure from digital options such as on-demand and streaming content provided by the likes of Netflix Inc.

On Wednesday, Sky Network Television said subscribers fell to 816,000 in December, from around 853,000 in June. That contributed to a 32% fall in net profit to NZ$59.3 million in the six months through December.

Sky Network Television's competitors mounted a concerted effort to derail the deal, partly because they feared it would entrench the former's monopoly of sports content rights in a country where the All Blacks dominate world rugby. Three New Zealand companies - 2degrees, Spark NZ Ltd. and InternetNZ - were prepared to challenge the deal in court.

"This is a very disappointing conclusion to a merger we saw as enhancing New Zealand's communications and media landscape," Sky Network Television Chief Executive John Fellet said on Thursday.

-Write to David Winning at [e-mail]

(END) Dow Jones Newswires

February 22, 2017 15:22 ET (20:22 GMT)

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