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Megafon to merge with Scartel in sngle holding – Kommersant

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MOSCOW, Jun 18 (PRIME) -- Russia’s Federal Antimonopoly Service has confirmed approval of a motion filed by major domestic mobile operator MegaFon and wireless broadband operator Scartel for a merger, the regulator said in a statement Monday.

The approval was made on June 15, the federal service said.

Earlier on Monday, business daily Kommersant reported, citing a source close to the federal service and two managers close to the shareholders of MegaFon and Scartel, that the deal had been cleared.

The antimonopoly service said that it sustained a motion filed by MegaFon’s affiliate Garsdale Services Investment Ltd. seeking to acquire Scartel, which is known by the Yota brand.

The regulator also instructed the operators to provide access to their fourth generation (4G) networks based on Long Term Evolution (LTE) technology to other operators on MVNO (mobile virtual network operator) principles, if it complies with their technical capabilities.

In late April, the antitrust service said it believed that a merger between MegaFon and Scartel could negatively affect competition on the broadband Internet access market, adding that it needed more time to deliberate the deal. In late May, the federal service’s representative Dmitry Rutenberg said the service had postponed deliberating the motions for a merger between MegaFon and Scartel until July 25, as cited by RBC Daily. Rutenberg said that the federal service plans to make its final decision on the merger after federal tenders are finished for the frequencies suitable for the development of 4G LTE networks.

Results of the tenders announced by the federal service for communications oversight in May are expected to be disclosed on July 12, and MegaFon, which filed a bid for the frequencies, has been named by analysts as one of the likeliest winners.

Scartel has been cleared to use the 2.5–2.7 gigahertz (GHz) frequency band to develop LTE networks. The operator has already launched its LTE services in Novosibirsk, Krasnodar, Moscow, Sochi, and Samara.

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