(Reuters) -Macquarie-backed fibre network Vocus Group will emerge as one of Australia's largest owners of underground fibre infrastructure, after the competition regulator approved on Thursday its A$5.25 billion ($3.34 billion) deal with TPG Telecom ( TPGTF ).

Vocus and TPG, back in October 2024, had agreed to a deal for the former to take over the telecom operator's fibre and fixed network infrastructure assets, enabling Vocus to connect almost 20,000 buildings in Australia.

The Australian Competition and Consumer Commission (ACCC) said the deal would not likely result in a substantial reduction of competition in any market.

The ACCC's review focused on how closely Vocus and TPG compete in the supply of data network and connectivity services, including fixed-line internet services, to large enterprise and government customers, it said in a statement.

The ACCC said that Vocus would continue to face major competition from other sectoral firms - including Telstra ( TTRAF ), Singapore Telecommunications-owned Optus - and other local players such as Superloop and Aussie Broadband.

The watchdog's probe further found that Vocus focuses on providing services to large enterprise and government clients while TPG concentrates on the small and medium enterprise segment of the market.

Shares in TPG gained over 5% in Sydney to A$4.78. Its biggest rival, Telstra ( TTRAF ), was trading 0.7% higher.

A Macquarie-managed infrastructure fund, alongside Aware Super, acquired Vocus in 2021, taking the company private and delisting it from the Australian exchange.

Macquarie has since strengthened its position, with Dutch pension fund APG acquiring a 10% interest in Vocus. The move reduced Aware's holding while leaving Macquarie's stake unchanged, firmly positioning the asset manager in the driver's seat.

Vocus did not respond to a Reuters request for comment.

($1 = 1.5721 Australian dollars)