Posted By Uma Rajagopal
Posted on December 5, 2024
By Paul Sandle
LONDON (Reuters) -Britain on Thursday approved the $19 billion merger between Vodafone UK and Hutchison’s Three UK to create the country’s biggest mobile operator and reduce the number of networks to three from four.
The Competition and Markets Authority had previously said the deal could push up customer prices, but it later accepted that a pledge by the two companies to invest in 5G networks and offer protections for retail and wholesale customers were enough to ease its concerns.
We believe the merger is likely to boost competition in the UK mobile sector and should be allowed to proceed – but only if Vodafone and Three agree to implement our proposed measures,” it said.
The approval follows a demand by Prime Minister Keir Starmer that regulators put the need for investment and economic growth at the forefront of their thinking.
Vodafone and Three have committed to spend 11 billion pounds ($14 billion) to build a better 5G network that will serve 50 million customers, including the subscribers of Vodafone’s network sharing partner Virgin Media O2.
The CMA said the investment would boost competition between the three remaining networks, which includes current market leader BT, and deliver a better service for customers.
Vodafone’s Chief Executive Margherita Della Valle said the green light would unlock the investment needed to build the network infrastructure Britain deserved.
Today’s approval releases the handbrake on the UK’s telecoms industry, and the increased investment will power the UK to the forefront of European telecommunications,” she said.
Vodafone will own 51% of the combined company and will have an option to buy the remainder after three years following completion and subject to certain conditions.
($1 = 0.7859 pounds)
(Reporting by Paul Sandle; Editing by Kate Holton)
