New Zealand’s Commerce Commission raised preliminary concerns about a proposed acquisition of 2degrees’ passive infrastructure by Spark’s independent tower unit Connexa and opened a public consultation on the transaction.

Its investigation will assess the potential effects of any deal, in particular whether a loss of competition would enable the merged entity to profitability raise prices, or reduce quality or innovation.

The Commerce Commission stated the probe will also cover if the deal would allow or incentivise the new business or Spark to deprive rivals of access, along with if the move might result in “any horizontal unilateral, vertical or coordinated effects”.

Interested parties have until 13 February to submit comments as part of the consultation. The Commission is scheduled to decide on the sale by 7 March, but stated this may be extended as the investigation progresses.

The regulator previously stated it will clear the proposed deal provided it judges it “unlikely to have the effect of substantially lessening competition”.

Connexa agreed the deal to acquire more than 1,100 towers from 2degrees for NZD1.1 billion ($714.1 million) last month.