British telecoms group Vodafone said on Monday it was considering merging its UK operations with Three UK, a subsidiary of Hong Kong holding company CK Hutchison.
“Vodafone has confirmed talks with CK Hutchison Holdings Limited regarding a potential combination between Vodafone UK and Three UK.“Explains the British group, confirming the information of Sky News. The British will get 51% of the total, and the Chinese group will get 49%. The combination of Vodafone UK and Three UK, numbers three and four respectively in the UK market, will create an operator with more than 27 million subscribers. It will then become the market leader, overtaking the current number one and number two, EE, which is owned by BR, and Virgin Media O2. So far, the European regulator has been hostile to this type of merger. But after Brexit, the British competition authority may have a different analysis of the case, which will be closely watched by European market operators.
Vodafone also shows the country’s competitiveness argument to justify this action. “The UK government rightly sees 5G as (…) essential for the UK to become more competitive in the digital world.“. Gold”some operators such as Vodafone UK and Three UK do not have the scale to make their investments profitable.in 5G, emphasizes Vodafone, referring to the British telecommunications authorities, Ofcom. “Together, Vodafone UK and Three UK will be able to accelerate the roll-out of 5G across the UK and extend broadband to rural communities and SMEs.”, claims Vodafone. The marriage of the two UK entities will allow it to deploy just one network instead of two.
More broadly, Vodafone has embarked on an extensive restructuring program, from selling certain assets, such as its towers in Hungary or New Zealand, to attempts to consolidate in its core markets. This activity is an additional example of this.
A tempting prospect for financial markets. Vodafone rose 2.89% to 104.04 pence in early afternoon trading on the London Stock Exchange.
Source: Le Figaro
I am David Wyatt, a professional writer and journalist for Buna Times. I specialize in the world section of news coverage, where I bring to light stories and issues that affect us globally. As a graduate of Journalism, I have always had the passion to spread knowledge through writing.