Vodafone completes £15 billion mega-merger with Three UK

By JON BRADY, SENIOR NEWS REPORTER

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Vodafone has completed its £15 billion mega-merger with Three UK creating a 'new force in UK mobile' - despite concerns it could lead to higher prices. The mobile phone giant said the merger of the UK network businesses was officially completed on May 31, nearly two years after it was first announced.

Vodafone has completed its £15 billion mega-merger with Three UK creating a 'new force in UK mobile' - despite concerns it could lead to higher prices. The mobile phone giant said the merger of the UK network businesses was officially completed on May 31, nearly two years after it was first announced.

VodafoneThree - now the biggest mobile phone network in the UK with around 27 million customers - pledged to invest £11 billion over the next 10 years to help boost its 5G capability, with £1.3 billion being spent this financial year, following the tie-up. Despite concluding that the merger would lead to higher prices for customers, the Competition and Markets Authority (CMA) approved the deal last December.

VodafoneThree - now the biggest mobile phone network in the UK with around 27 million customers - pledged to invest £11 billion over the next 10 years to help boost its 5G capability, with £1.3 billion being spent this financial year, following the tie-up. Despite concluding that the merger would lead to higher prices for customers, the Competition and Markets Authority (CMA) approved the deal last December.

It required the firms to make the huge investment in its network, and to cap prices of certain tariffs for at least three years. The merger now means there are now only three main phone networks in the UK: VodafoneThree, EE (owned by BT since 2016), and O2, which merged with Virgin Media in 2021.

It required the firms to make the huge investment in its network, and to cap prices of certain tariffs for at least three years. The merger now means there are now only three main phone networks in the UK: VodafoneThree, EE (owned by BT since 2016), and O2, which merged with Virgin Media in 2021.

Others, such as iD Mobile, Smarty and Giffgaff, are dependent on the infrastructure provided by the now three main operators. A report by Enders Analysis published in February suggested that the merged VodafoneThree would see it hold more than half of the UK's mobile network capacity. Experts have suggested the merger is good news for the UK's mobile infrastructure, given the level of investment the firm must now make in expanding its 5G network.

Others, such as iD Mobile, Smarty and Giffgaff, are dependent on the infrastructure provided by the now three main operators. A report by Enders Analysis published in February suggested that the merged VodafoneThree would see it hold more than half of the UK's mobile network capacity. Experts have suggested the merger is good news for the UK's mobile infrastructure, given the level of investment the firm must now make in expanding its 5G network.

But consumer group Which? said last year that the CMA's approval had been a 'gamble' that may not pay off. Its director of policy Rocio Concha said: 'For this merger to work for consumers, the CMA and Ofcom must rigorously monitor whether the merged company sticks to its commitments and be prepared to act decisively if it does not.'

But consumer group Which? said last year that the CMA's approval had been a 'gamble' that may not pay off. Its director of policy Rocio Concha said: 'For this merger to work for consumers, the CMA and Ofcom must rigorously monitor whether the merged company sticks to its commitments and be prepared to act decisively if it does not.'

Margherita Della Valle, Vodafone group chief executive, said: 'The merger will create a new force in UK mobile, transform the country's digital infrastructure and propel the UK to the forefront of European connectivity . 'We are now eager to kick off our network build and rapidly bring customers greater coverage and superior network quality. 'The transaction completes the reshaping of Vodafone in Europe, and following this period of transition we are now well positioned for growth ahead.'

Margherita Della Valle, Vodafone group chief executive, said: 'The merger will create a new force in UK mobile, transform the country's digital infrastructure and propel the UK to the forefront of European connectivity . 'We are now eager to kick off our network build and rapidly bring customers greater coverage and superior network quality. 'The transaction completes the reshaping of Vodafone in Europe, and following this period of transition we are now well positioned for growth ahead.'

The companies first announced the landmark deal in June 2023 - in a major shake up of Britain's mobile phone sector. It was scrutinised closely by the CMA amid concerns it could substantially reduce options for mobile customers and lead to higher bills. Watchdogs concluded that the team-up would likely result in a 'substantial lessening of competition' - but considered that compelling the firms to invest in their network and imposing price caps would balance out the whittling down of the marketplace. The CMA imposed conditions including the three-year cap in order to protect 'large numbers of Vodafone / Three customers from short-term price rises in the early years' of the merger.

The companies first announced the landmark deal in June 2023 - in a major shake up of Britain's mobile phone sector. It was scrutinised closely by the CMA amid concerns it could substantially reduce options for mobile customers and lead to higher bills. Watchdogs concluded that the team-up would likely result in a 'substantial lessening of competition' - but considered that compelling the firms to invest in their network and imposing price caps would balance out the whittling down of the marketplace. The CMA imposed conditions including the three-year cap in order to protect 'large numbers of Vodafone / Three customers from short-term price rises in the early years' of the merger.

VodafoneThree will be required to publish an annual report on its investment in its mobile network, with the CMA providing oversight. Canning Fok, deputy chairman of Three UK owner CK Hutchison, - said: 'Scale enables the significant investment needed to deliver the world-beating mobile networks our customers expect, and the Vodafone and Three merger provides that scale .' Vodafone owns 51% of the newly merged company and after three years will have the option to buy the rest of the merged firm.

VodafoneThree will be required to publish an annual report on its investment in its mobile network, with the CMA providing oversight. Canning Fok, deputy chairman of Three UK owner CK Hutchison, - said: 'Scale enables the significant investment needed to deliver the world-beating mobile networks our customers expect, and the Vodafone and Three merger provides that scale .' Vodafone owns 51% of the newly merged company and after three years will have the option to buy the rest of the merged firm.

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