TPG - Vodafone | Merger & price rise evaluation

During the case, Professor Gray gave evidence about the prospects of a stand-alone TPG being able to raise sufficient capital to build out a stand-alone 5G mobile phone network. The court accepted and relied on Professor Gray’s evidence. Paragraphs from the judgement include:

Professor Gray assessed the factual substratum that would inform the decision by investors as to whether to support the capital raising. He concluded that it was highly unlikely that a capital raising could be executed, even with the participation of Mr Teoh and WHSP, because any future raising would likely have to be at a greater discount than the 20% discount required in April 2017 because of the effect on market perception of TPG created by the failure of its first roll-out and the deterioration in its financial performance since that time. I accept this assessment.

READ THE ACCC PRESS RELEASE

Following the merger, we also analysed price changes and financial data and developed a hedonic pricing model that adjusted for changes in plan quality (through increased data allowances) to critically assess the ACCC's claims that the merger between TPG Telecom and Vodafone had caused price rises for retail mobile services in Australia.