Vodafone in talks to merge UK business with Three

  • Vodafone has confirmed that it is in talks with Hong Kong-based CK Hutchison about a possible merger of its UK business with Three UK.
  • Vodafone said the potential deal would see the two companies incorporate their UK business, with Vodafone holding 51% and CK Hutchison with the remainder of the combined business.

Susannah Streeter, Senior Investment and Market Analyst, Hargreaves Lansdowne:

“The confirmed reaction to recent merger discussions was at lunch with shares up 1.6% but down 3.8% in the five-day view. This could be due to significant regulatory hurdles ahead for the deal, as executives said.” Potential ceding ownership of more prominent UK infrastructure to a foreign owner has weighed in, but perhaps with conditions, with some analysis showing that Vodafone’s market share is nearly double that of Three. This development is a mega-merger in the region. Follows a defined trend of the U.S. with only four major operators still remaining. Those on the Left are already cooperating in areas such as remote rural areas, where low population densities require cost synergies. The objective will be to build a company on a large scale to fully capitalize on the opportunities provided by the 5G roll out. Setting up and maintaining a network is a very expensive business and since the government has a track to raise prices more than expected There is a record when companies In a bid to utilize this part, Vodafone has recognized that it needs to bulk up with a lot of power to be able to accelerate. Rollout of 5G and expanding connectivity to rural communities and small businesses. Obviously a lot still needs to be agreed and it is not certain if it is a perfect deal, but if it is signed a joint venture with Three UK the UK will become the biggest player in the mobile industry. Vodafone has long been focused on rolling out broadband, fixed line and TV services in its European markets, as customer retention among multiple product takers is significantly better, and a successful 5G rollout will be key to that strategy. .”

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