Viasat’s Inmarsat offer targeted by EU antitrust law

By Foo Yun Chee

BRUSSELS (Reuters) – U.S. company Viasat’s $7.3 billion bid for British satellite rival Inmarsat could reduce competition in the aviation communications market, European Union antitrust watchdogs warned on Monday, launching a full-scale investigation into the deal.

The companies, which compete with market leaders Panasonic and Intelsat in the long-haul flight Wi-Fi market, announced their tie-up in late 2021.

The European Commission said its concerns stemmed from Viasat and Inmarsat’s position as close competitors in Europe and globally in the provision of in-flight broadband communications (IFC) services to commercial airlines.

“At this stage, the Commission has concerns that by acquiring Inmarsat, Viasat may reduce competition in the provision of IFC broadband internet access services to commercial airlines in the EEA and/or globally,” the EU competition watchdog said in a statement.

It said there were few alternative suppliers and that technological and regulatory barriers would make it difficult for new players to enter the market.

The Commission said it would also examine whether non-geostationary satellite operators would be able to exert sufficient competitive pressure on the merged entity in the near future. It set a deadline of June 29 for issuing a decision.

Viasat, which owns and operates four geostationary satellites in Earth orbit, and Inmarsat, which has 15, said they would continue to cooperate with the EU regulator and believed the deal would increase competition in the satellite communications market.

The EU’s concerns echo those of the UK’s competition authority, which opened a detailed investigation into the deal in October last year.

(Reporting by Foo Yun Chee; Editing by Leslie Adler)