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Vodafone is considering a merger with Three UK in the UK

British telecoms group Vodafone announced on Monday that it was in talks to merge its UK operations with Three UK, a subsidiary of Hong Kong holding company CK Hutchison, to join forces in 5G.

Following rumors in the press, Vodafone “confirms discussions with CK Hutchison Holdings Limited about a possible combination between Vodafone UK and Three UK”, explains the British group, which would own 51% of the whole, while the Chinese group would have around. 49%. “The UK government rightly sees 5G as (…) essential for the UK to become more competitive in an increasingly digital world,” Vodafone said in a statement.

“Some operators in the UK, including Vodafone UK and Three UK, do not have the scale to make their investments profitable” in 5G, Vodafone stresses, referring to Ofcom, the British regulatory agency for the sector. “Together, Vodafone UK and Three UK will achieve the ability to accelerate the deployment of 5G in the UK and extend broadband connectivity to rural areas and SMEs,” the statement continued.

Vodafone rose 2.89% to 104.04 pence on the London Stock Exchange around 10am. 14:30 GMT. For Susannah Streeter, analyst at Hargreaves Lansdown, the relatively muted reaction to the move shows that analysts believe the transaction is far from guaranteed, due to likely “regulatory hurdles” in sight, “UK authorities are likely to carefully weigh the potential transfer of part of a strategic infrastructure to a foreign owner”. The terms of the transaction are also questionable, Ms Streeter points out: “Vodafone’s market share is almost twice that of Three UK. ยป

The telephony group had posted a small rise in revenue for its staggered first quarter at the end of July, with a drop in revenue in Germany, its biggest market, offset by a rise in the UK, driven mainly by inflation. . Revenue thus increased by 1.6% compared to the same period last year, to 11.3 billion euros, but fell by 0.5% in Germany.

The telecoms operator, one of the heavyweights in Europe, has been restructuring for several years, which has made it focus on Europe and Africa, after implementing a savings program and listing its subsidiary Vantage Towers on the Frankfurt stock market. CK Hutchison is a diversified group, notably owner in the United Kingdom of the port of Felixstowe, the largest for cargo in the country, and currently the scene of a social movement for wage increases.

British telecoms group Vodafone announced on Monday that it was in talks to merge its UK operations with Three UK, a subsidiary of Hong Kong holding company CK Hutchison, to join forces in 5G. the press, “Vodafone confirms discussions with CK Hutchison Holdings Limited for a possible combination between…

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