UK entity completes investigation, clears Motorola Solutions’ deal for Airwave TETRA system
Motorola Solutions’ purchase of Airwave Solutions and its massive TETRA network last week was cleared from investigation by the Competition and Markets Authority (CMA) in the United Kingdom (UK), which launched the inquiry shortly after Motorola Solution paid more than $1 billion for Airwave.
On Friday, the CMA announced that it had “cleared” the Motorola Solutions-Airwave deal that was announced in December 2015 and closed on Feb. 19 this year, but details of the decision had not been posted yet on the CMA web site. Motorola Solutions separately issued a press release that the CMA “unconditionally cleared” the Airwave deal.
In March, the CMA issued an initial enforcement order stating that it was considering “whether it is, or may be, the case that a relevant merger situation has been created and whether the creation of that situation has resulted or may be expected to result in a substantial lessening of competition in any market or markets in the United Kingdom for goods or services.”
After formally launching the merger inquiry on May 5, the CMA issued a revocation of its initial enforcement order on June 8 and closed its investigation last Friday, according to a timeline displayed on the CMA web site.
Tama McWhinney, Motorola Solutions’ head of communications, said that the Motorola Solutions-Airwave transaction received multiple regulatory approvals before the deal closed in February, but this inquiry was initiated after the purchase was finalized.
Meanwhile, worldwide financial markets in recent weeks have focused considerable attention on the recent UK election to leave the European Union, commonly known as Brexit. Although the British pound has dropped in currency value compared to the U.S. dollar, the ongoing value of the Airwave deal to Motorola Solution is not expected to be altered significantly, she said.
“We expect no direct impact from Brexit beyond potential macro-economic and limited foreign-exchange impact,” McWhinney said in a statement e-mailed to IWCE’s Urgent Communications.
“All of the Airwave revenues are in pounds—and so are the costs, providing a natural bottom-line hedge. Our European headquarters also is in the UK, so we have operational expenses benefiting from the weaker pounds as well. Finally, there are no contractual arrangements to change the pricing based on currency fluctuation.”
UK officials have stated that they plan to have public-safety personnel stop using the Airwave system at the end of 2019, but there are provisions in the contract that would allow the TETRA system to be used beyond that period. UK officials want to transition first responders to the LTE-based Emergency Services Network that will leverage network infrastructure and spectrum from commercial wireless carrier EE—recently purchased by British telecom provider BT—and services from Motorola Solutions.