"Significant harm to competition in the cellular market" - this is how MK Dr. Shlomo Karai (Likud) defines a possible sale of the cellular company Expon to Cellcom, through Golan Telecom.
In a letter sent yesterday to the outgoing commissioner of the competition, Adv. Michal Halperin, and received by "Israel Hayom", Qarai warned that such a deal would dramatically increase cellular prices. The large-scale expansion carried out in 2012, thanks to which cellular prices were lowered, will increase the price to the consumer and the cost of living. "
As of 2020, according to data from a British comparison site, Israel is the second cheapest country in the world in terms of cellular service prices.
The cumulative savings for households in expenditure as a result of the reforms are estimated at NIS 15 billion, but on the other hand the possible technology in Israel lags significantly behind other Western countries: the technological infrastructure in Israel is currently mainly in 4th generation, compared to most other countries.
The race to buy Expon
In his letter, Kari refers to the decision that is to be made in the coming days, regarding the sale of "018 Expon" - a company that creates competition in the cellular market, which owns about 350,000 subscribers.
Following a legal dispute between Expon and Cellcom regarding a network sharing agreement between the two, Expon submitted an application for approval of the sale of its operations to the "Vidley Mobile" company owned by the Reichman family from Canada, for the purpose of repaying its debts.
Cellcom, Expon's largest creditor, opposes the sale of the company to the Reichman family, claiming that it has signed an infrastructure use agreement with Pelephone - a competitor of Cellcom.
MK Shlomo Qara // Photo: Oren Ben Hakon,
In recent weeks, several applications have been submitted for the acquisition of Expon by companies other than Widdley, including Partner - another competitor of Cellcom.
One of the takeover bids was submitted by Golan Telecom, which was acquired last year by Cellcom and is a subsidiary of it.
This week, Golan Telecom announced an improvement of the offer by NIS 5 million, to NIS 65 million for the acquisition of Expon.
This proposal is supposed to cover Expon's debt to Cellcom, which the latter claims stands at NIS 62 million.
Expon, on the other hand, claimed that the said debt amounted to a little over NIS 40 million, and that Cellcom's previous acquisition offer was intended to "eliminate Expon."
MK Qarai claims that the merger between Cellcom and Golan "left the market with one significant source of competition - Expon, and now it seems that Cellcom intends to acquire it as well." New players in the future - which will lead to severe damage to the competition.
"In light of this," Kari wrote to Adv. Halperin, "I request that the Competition Authority give its opinion on Cellcom's acquisition offer through Golan Telecom, for all the implications that this derives from it."
The Competition Authority responded: "The Competition Authority has not yet received merger notices from the parties. As far as notices are concerned, the Authority will examine the merger in depth. Here it should be noted that even in the case of a failed firm, If at a lower price. "