FRANKFURT, Aug 20 (Reuters) - The proposed tie-up of theGerman units of KPN and Telefonica willrequire close scrutiny by the German Cartel Office, the head ofthe antitrust watchdog said.
"It is evident that such a combination would have aconsiderable impact on competition and will have to beinvestigated closely in all is facets," the office's PresidentAndreas Mundt told Frankfurter Allgemeine Zeitung (FAZ)newspaper in an excerpt of an article to be published onWednesday.
"This is clearly a case for Bonn," he said in the excerpt,made available to Reuters on Tuesday, referring to the citywhere the cartel office is based.
Dutch telecoms group KPN last month agreed to sell itsGerman unit to Spain's Telefonica for 8.1 billion euros ($11billion) in cash and shares.
If KPN's disposal of the E-Plus unit goes through, the newcompany would hold a share of about 30 percent of Germany'smobile service revenue and would be better placed to take onDeutsche Telekom and Vodafone, with 35percent each.
Mexico's America Movil, which has bid for the 70percent of KPN it does not already own, said it was stilldeciding whether to back the deal.
FAZ quoted Mundt as saying that the German Cartel Office andnot the European Commission should "clearly" be in charge ofregulatory scrutiny of the deal.
Antitrust regulation of the German telecoms sector madeheadlines earlier this month when a court ordered the carteloffice to re-examine U.S. cable company Liberty Global's acquisition of its German peer KabelBW, which wasapproved at the end of 2011.
Mundt told FAZ that he would have expected the conditionsthe cartel office had initially imposed on Liberty Global tohave a stronger effect on competition in the German cableindustry than they turned out to have.
Mundt was also quoted as saying the German cartel office washappy to let the European Commission decide on the plannedtakeover of Germany's largest cable provider, Kabel Deutschland by Vodafone.
"After a first, preliminary assessment on our part, this israther a complementary tie-up."