TPG Telecom has received a green light from Australia's competition watchdog for a A$1.59 billion (US$1.07 billion) infrastructure and network sharing deal with Optus as TPG seeks to expand its reach.
The Australian Competition and Consumer Commission (ACCC) on Thursday gave its approval to TPG Telecom's arrangement with Singapore Telecommunications-owned Optus to share regional networks.
The regulator had earlier blocked a similar deal between TPG and rival telecom firm Telstra.
TPG's network size would double after the deal, which kicks in next year, enabling the firm to raise its market share even as Telstra continues to have the widest mobile network in Australia.
TPG's shares rose as much as 1.4 per cent, whereas Telstra, which is the leader in most of Australia's main internet and telecommunications markets, slipped more than 1.0 per cent.
Telstra did not immediately respond to a Reuters request for comment.
TPG Telecom expects to pay Optus total service fees of around A$1.59 billion over the 11-year term of the deal, it had said while announcing the arrangement in April.
"The ACCC clearly took a brighter view of this deal compared to the ill-fated TPG-Telstra proposal," said Tim Waterer, market analyst at KCM Trade.
"The regulatory body sees the deal as a win for consumers, with those in rural areas likely to benefit from greater coverage."
The network sharing deal would not significantly impact competition for wholesale and retail mobile services, the competition regulator said, flagging that issues might be limited to areas where TPG is not already a major service provider and competitor.
TPG Telecom expects to record A$230 million to A$250 million of non-cash charges related to the 755 network sites under the deal for fiscal 2024.
The firm said its expanded network will be operational in early 2025.