A sign outside a Vodafone Group Plc mobile phone store in London, U.K.
Jason Alden | Bloomberg | Getty Images
Vodafone and CK Hutchison, which owns the Three UK mobile network, agreed to merge their U.K. businesses, following talks that have been ongoing since last year, the companies said Wednesday.
Vodafone will own 51% of the combined business, leaving CK Hutchison the minority stake. The new merged business will invest £11 billion ($13.91 billion) in the U.K. over 10 years.
Vodafone has been going through a transition period since its former CEO Nick Read stepped down at the end of last year. Vodafone appointed Margherita Della Valle as permanent CEO in April to transform the business.
The combination of Vodafone’s U.K. business and Three UK will reduce the number of mobile operators in the country to just three, after major consolidation in the telecommunications sector in the past few years.
Vodafone and Three were lagging behind larger rivals EE, which is owned by BT, and O2, which is owned by Telefonica and Liberty Global via a joint venture. BT acquired EE in 2016, while Telefonica and Liberty Global launched Virgin Media O2 in 2021.
The deal will need approval from the U.K.’s Competition and Markets Authority (CMA) which has become increasingly-powerful and looked to hamper big mergers and acquisitions. Last month, the CMA moved to block Microsoft’s $69 billion acquisition of gaming firm Activision Blizzard.
This is a breaking news story and will be updated shortly.
This story originally appeared on CNBC
