By Foo Yun Chee
BRUSSELS (Reuters) - Vodafone's $21.8 billion proposed acquisition of Liberty Global's assets in Germany and eastern Europe is likely to face a full EU antitrust investigation, a person familiar with the matter said.
The European Commission's move could ratchet up pressure on the world's second-largest mobile operator to offer concessions, unless it can convince the EU competition enforcer that the deal poses no competition issues.
Investors and industry players, however, will be hoping for a flexible regulatory stance given that the Commission has just given unconditional clearance for Deutsche Telekom's acquisition of Tele2's Dutch business after initial concerns.
The deal between Vodafone and U.S. cable pioneer John Malone's Liberty would enable Vodafone to better compete with Deutsche Telekom in the German rival's home market.
The enlarged company would be Europe's biggest provider of broadband, cable and mobile services with 54 million customers and reach 110 million homes and businesses. The acquisition includes Liberty Global assets in the Czech Republic, Hungary and Romania.
Deutsche Telekom has criticised the deal while Telefonica Deutschland and the BREKO business group, which represents German broadband providers, have urged the EU to block the takeover because it would hurt competition.
The opening of a so-called in-depth investigation would in practical terms mean the European Commission's rejection of a request by the German cartel authority to take over the case - a request that had been welcomed by Deutsche Telekom. The Commission may see the deal in a broader EU-wide perspective, which could benefit Vodafone.
The Commission, which is scheduled to wrap up its preliminary review by Dec. 11, and Vodafone declined to comment. Liberty Global said: "We are in constructive discussions with the European Commission and are confident of a positive outcome in due course."
(Reporting by Foo Yun Chee; Editing by Susan Fenton)