Vodafone, Sky ditch merger proposal
Sky Television and Vodafone New Zealand have dropped a proposed merger of the two companies.
An announcement to the New Zealand stock exchange from Sky yesterday said it and Vodafone NZ had decided to terminate an agreement relating to the proposed merger. An appeal against the Commerce Commission’s decision to decline the merger had also been dropped.
‘‘Sky Television and Vodafone NZ will continue to work together to strengthen our commercial relationship for the benefit of the customers and the shareholders of our respective organisations,’’ Sky said.
In March, the companies had filed an appeal against the competition watchdog’s blocking of the proposed merger to ‘‘preserve their options’’ ahead of a legal deadline.
It had been unclear whether they would follow through, but last month the companies said they would press ahead with the appeal.
Sky TV chief executive John Fellet likened the prospect of an appeal to having ‘‘root canal work’’ done after the competition watchdog blocked the proposed merger of their businesses in February.
Vodafone’s British-based parent would have ended up with $1.25 billion in cash and a 51 per cent share in the merged business had the merger been approved.
Sky shares have fallen by more than $1 over the past year, to trade at $3.39.