Finance Minister Moshe Kahlon, who is largely credited with opening up the cell phone market to competition when he was communications minister, is strongly opposed to the sale of Golan Telecom to Cellcom.
In a letter to Antitrust Commissioner Uri Schwartz, he warned: "granting approval to this purchase will constitute serious damage to competition in the cellular market, and will lead to a rise in prices. Harming competitiveness in the cellular market will be regretted for many years to come."
"Recently," he added, "the professional elements in my office carried out an extensive survey into the financial aspects of the purchase of Golan Telecom by an existing operator. I believe that the right thing for the market and the consumers is for Golan Telecom to stay in the market as an independent operator that is not owned by an existing operator. I request that you carry out professional meetings with my ministry's staff before forming your opinion."
In no scenario, he said, should the purchase of Golan Telecom by an existing operator be approved, since this would "bring about the existence of a cellular company with a market share of close to 40%, causing critical damage to the existing competition in the market."
"Merging Golan and Cellcom is a serious mistake," Kahlon stated. "The price of calls will climb to hundreds of shekels per month instead of the tens of shekels that the public currently pays. Approval of the merger will bring us back to the days of no competition, and the consumers will become the victims of the move."
The Golan Telecom merger with Cellcom prompted a fierce backlash Wednesday from concerned from customers and government officials.
Internal Security Minister Gilad Erdan (Likud), who was also communications minister in the past, blasted the sale and called on Schwartz as well as Communications Ministry Director-General Shlomo Filber to reject the acquisition.
According to Erdan, if Golan's owners refuse to invest the amount required to adhere to the conditions of the company's tender, the appropriate decision is to "impose large fines, consider taking away the company's license and sell it to a new cellular company just entering the market."