ISLAMABAD – The Competition Commission of Pakistan (CCP) has expressed significant reservations regarding Pakistan Telecommunication Company Limited’s (PTCL) business plan amid the ongoing Phase-II review of its proposed 100% acquisition of Telenor Pakistan (Private) Limited (TP) and Orion Towers (Private) Limited (OT). The review, conducted under Section 11(6) of the Competition Act, 2010, assesses the merger’s impact on competition within Pakistan’s telecom and tower infrastructure sectors.
During a detailed hearing, PTCL’s senior management and legal team presented the merger rationale, anticipated efficiencies, and regulatory accounts. However, the CCP bench—comprising Chairman Dr. Kabir Ahmed Sidhu, Member Salman Amin, and Member Abdul Rashid Sheikh—raised critical questions about the merger’s potential effect on market competition and consumer welfare. The Commission called for clearer details on operational integration, long-term market positioning, and consumer impact.
Industry sources reveal that the CCP found PTCL’s post-merger strategy vague, particularly regarding operational integration and customer base expansion. The bench flagged a lack of transparency on how PTCL plans to merge operations with Telenor Pakistan and Orion Towers to benefit consumers and improve service quality.
The Commission also highlighted inconsistencies in PTCL’s financial forecasts and questioned the assumptions underpinning its regulatory framework, suggesting these might not fully address the merger’s competitive implications.
CCP has requested additional documentation from PTCL to validate claims related to service quality, pricing, and market behaviour post-merger. Given the transaction’s scale and potential to reshape Pakistan’s telecom landscape, the Phase-II review involves heightened scrutiny to thoroughly assess market dynamics.
A notable concern is the financial losses of PTCL’s mobile subsidiary, Ufone. Persistent losses raise doubts about PTCL’s capacity to manage an expanded telecom operation effectively. Sources note that PTCL has yet to convince the CCP of its strategy’s viability, especially concerning customer base growth and efficient use of telecom tower infrastructure.
The Commission questioned PTCL’s ability to manage the enlarged entity, especially considering Ufone’s current financial state. CCP members specifically asked how PTCL plans to leverage the expanded tower infrastructure to attract new customers—a critical component of the business plan.
In response, PTCL requested additional time to provide a more detailed response addressing the Commission’s concerns. CCP agreed to this extension, emphasizing the need for transparency and robust planning for such a large-scale transaction.
The CCP reaffirmed its dedication to protecting fair competition and consumer choice, underscoring that any major transaction must present clear, transparent, and well-documented integration and efficiency plans. The final merger decision will follow a comprehensive review of the additional information provided by PTCL.
PTCL’s bid to acquire Telenor Pakistan and Orion Towers represents a significant industry move, potentially consolidating infrastructure and customer networks. However, regulatory concerns—particularly over competition and the financial health of PTCL’s subsidiaries—could determine whether the merger is approved, conditioned, or blocked.
