Britain’s Competition and Markets Authority has approved the £15 billion merger between Vodafone and Three, provided the companies commit to investing billions in a joint 5G network rollout across the U.K.
This decision allows the merger to proceed with the condition of significant investment in infrastructure, according to CNBC.
In addition to the 5G investment commitment, the merged Vodafone-Three entity will be required to cap specific mobile tariffs and provide preset contractual terms to mobile virtual network operators, which rely on other companies’ networks.
Vodafone and CK Hutchison, the parent company of Three U.K., revealed the merger last year. With the deal now approved, the two companies will combine their U.K. businesses, giving Vodafone a 51% controlling stake while CK Hutchison will hold the minority share.
“This mega-merger marks one of the most significant moments in the history of UK mobile, heralding the arrival of a new market leader with a combined 29 million customers,” Kester Mann, director of consumer and connectivity at CCS Insight, said in a note on Thursday.
“The outcome – after months of intense regulatory scrutiny – is about as good as it could have got for Vodafone and Three. Not only did they secure approval, but the agreed remedies and commitments are less onerous than feared.”
The CMA’s decision follows an antitrust investigation that began in January, with an in-depth probe launched in April. Last month, the competition regulator outlined a path for the deal to proceed, contingent on the adoption of certain remedies.
The regulator was concerned that the merger, which reduces the number of major telecom network providers from four to three, could result in higher prices or lower service quality.
Vodafone expects the deal to be officially completed in the first half of 2025.
“Today’s decision creates a new force in the UK’s telecoms market and unlocks the investment needed to build the network infrastructure the country deserves,” Vodafone CEO Margherita Della Valle said in a press release.
