The proposed $3 billion (€2.7 billion) deal by the telco Cable & Wireless Communications (CWC) to take over Columbus International appears to be nearing completion, creating a major competitor for Denis O'Brien's Digicel as it attempts to build its fixed-line business.
The takeover, which has been heavily criticised by Mr O'Brien on competition grounds, has recently received full competition clearance in Trinidad & Tobago, as well as the approval of the Barbados Fair Trade Commission. It was already approved in Jamaica, where Digicel is headquartered.
The only major stumbling block remaining to completion of the transaction, which already has shareholder approval from Cable & Wireless and Columbus, is the formal imprimatur of the communications minister in Barbados.
Regulators in Trinidad & Tobago approved the deal on Friday on condition that Cable & Wireless sell off its 49 per cent stake in the State telecoms company. Digicel would be a likely buyer for this business, although Mr O’Brien would be unable to transform its operations unless he convinces the government to give him full control.
Mr O'Brien has lobbied regional regulators strongly over the takeover, which he said should only go ahead after a major sell-off of overlapping assets. The Eastern Caribbean Telecommunications Regulator Authority (Ectel), an umbrella group for regulators in several small island nations such as St Lucia, had previously raised concerns about the deal when it was announced last November. Ectel approval, however, is not a condition for the deal to go ahead.
Digicel’s group chief executive
declined to comment when asked about the approvals process and whether the deal should go ahead regardless of Ectel.
However, in a statement issued in the Caribbean yesterday, Digicel called upon Ectel to publicly clarify the status of the competition investigation into the CWC-Columbus deal.
“Digicel has previously stated that Ectel [and local regulators] have an absolute right, morally as well as legally, to subject the proposed merger to rigorous examination . . .” said Mr Delves. “We are seeking clarification from Ectel . . . in this regard.”
Digicel said it has particular competition concerns over the deal in the Ectel nations of St Lucia, Grenada, St Vincent and the Grenadines.
It is understood that CWC and Columbus believe the merger is on the verge of completion. CWC previously told its investors it would close at the end of the first quarter of the year, which is today.