Vodafone (VOD.L) and CK Hutchison (0001.HK) finally unveiled the 15 billion pound ($19 billion) merger of their British mobile operations on Wednesday, saying the creation of a new market leader would drive competition and investment in the country.
The long-awaited deal, after the two companies publicly revealed they were in talks in October, will now trigger prolonged scrutiny by the anti-trust regulator into whether an operator with 27 million customers can damage competition.
Seeking to win over politicians, unions and the competition authorities, the two groups said they would invest 11 billion pounds in Britain over 10 years to create what they described as “one of Europe’s most advanced standalone 5G networks”.
“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,” CK Hutchison Co-Managing Director Canning Fok said.
Under the terms, Vodafone will own 51% and Hutchison 49% of the combined group, which will be led by current Vodafone UK boss Ahmed Essam. The finance chief of Hutchison’s Three UK, Darren Purkis, will take the same role in the new group.