LONDON, April 14 — Britain’s competition regulator today approved a blockbuster £31-billion merger of telecoms giant O2 and pay-TV company Virgin Media.

O2, owned by Spanish group Telefonica, and Virgin Media-run Liberty Global of the US announced in May plans to merge their rival British units in a massive shake-up of the UK telecommunications and home entertainment market.

The deal was unlikely to adversely affect services, the Competition and Markets Authority said in a provisional decision today.

"A thorough analysis of the evidence... has shown that the deal is unlikely to lead to higher prices or a reduced quality of mobile services — meaning customers should continue to benefit from strong competition,” noted CMA panel inquiry chairman Martin Coleman.

The merger is set to close this year, with the combined group worth around £31 billion.

O2’s network in the UK is used by its 34 million mobile-phone customers and millions more via other operators.

Virgin Media has 5.3 million broadband, pay-TV and mobile users. — AFP