The owner of Vodafone and Three UK, CK Hutchison, made a big promise to the British: if the agreement between the two companies is implemented, they will invest £ 11 billion in 5G within ten years. However, competition organizers must first approve the process. If their merger is approved, the combined group will be the largest mobile operator in the country, with Vodafone owning the majority stake of 51 percent.
The new combined group will include the two companies’ UK operations only. If the merger takes place, the group will have a total of 27 million mobile customers, surpassing O2 and BT EE owned by the group.
They made a big promise, they’re developing the 5G network
However, the merger is likely to raise concerns with the competition authority as they fear it will reduce competition. However, the two groups will invest £11 billion over 10 years to create “one of the most advanced standalone 5G networks in Europe”.
The new company will be led by the current CEO of Vodafone UK, Ahmed Essam, and will result in savings of £700m per annum by year five.
The merger will be implemented through a debt settlement, while Three will transfer 1.7 billion pounds to the new company Sky News.
CK Hutchison, a Hong Kong-based conglomerate, had previously considered selling Three UK. According to the organization’s internal analyses, the size of the company is insufficient to warrant the large capital investment required to develop the network infrastructure. The merger was initiated by former Vodafone CEO Nick Read, but he was replaced last year due to frustration with the company’s performance.
