New Delhi (India), 15th June 2023: On Wednesday, Vodafone and CK Hutchison officially announced their 15 billion pound ($19 billion) merger of their British mobile operations, claiming that the formation of a new market leader will encourage competition and investment in the country.
The long-awaited agreement, announced by the two firms publicly in October, will now prompt the anti-trust agency to conduct a thorough investigation into whether an operator with 27 million users may harm competition.
CK Hutchison Co-Managing Director Canning Fok said, “Together, we will have the scale needed to deliver a best-in-class 5G network for the UK, transforming mobile services for our customers and opening up new opportunities for businesses across the length and breadth of the UK.”
Under the terms of the agreement, Vodafone would hold 51% of the merged firm, with Hutchison owning 49%. The combined group will be overseen by existing Vodafone UK CEO Ahmed Essam. Darren Purkis, the finance chief of Hutchison’s Three UK, will take on the same role in the new business.
The combined operator will have approximately 27 million users, surpassing BT’s EE and VM O2, which are owned jointly by Telefonica and Liberty Global.
Vodafone, the third-largest mobile provider in the UK, and Hutchison, the fourth-largest, will have options that would allow Vodafone to acquire the Hong Kong-based conglomerate’s 49% holding in the future.
By the fifth year after the merger is completed, the two companies expect to save more than 700 million pounds per year by consolidating networks.
Vodafone shares, which had fallen to a 25-year low of 71 pence on Tuesday, climbed 3.6% after the agreement was revealed.
