Vodafone and Three might announce UK merger this month: report

Vodafone had initially announced merger talks with Three UK in October 2022

U.K. operators Vodafone and Three UK are reportedly working on the final details to announce a merger that would create the United Kingdom’s largest mobile operator, according to a Bloomberg report.

According to the report, the two carriers could potentially announce the launch of a merger process this month. Both Vodafone and Three are currently discussing a strategy for addressing antitrust concerns, Bloomberg reported.

The two telcos are also talking about how Hong Kong-based CK Hutchison might exit its share in the joint venture over a longer term, according to the report.

In October last year, Vodafone Group confirmed that it was in discussions with CK Hutchison Holdings in relation to a possible combination of Vodafone UK and Three.

Vodafone said that the potential transaction would involve both companies combining their U.K. businesses, with Vodafone owning 51% and CK Hutchison owning 49% of the combined entity.

Vodafone also said that a deal to create a new telecoms group would be key, given the huge costs of rolling out and maintaining new 5G network infrastructure in the country.

“By combining our businesses, Vodafone UK and Three UK will gain the necessary scale to be able to accelerate the rollout of full 5G in the U.K. and expand broadband connectivity to rural communities and small businesses,” Vodafone had said.

“The merged business would challenge the two already consolidated players for all U.K. customers and bring benefits through competitively priced access to a third reliable, high quality, and secure 5G network throughout the U.K.,” Vodafone added.

The transaction would be subject to an in-depth investigation by the Competition and Markets Authority.

Three initially launched 5G services in the U.K. in August 2019, with the initial offering of a high-speed 5G broadband service in parts of London. In July, the operator said that its 5G service was currently available across 3,200 sites in more than 400 locations.

Vodafone initially launched 5G services in the U.K. in July of 2019. The telco’s initial offering covered parts of Birmingham, Bristol, Cardiff, Liverpool, London, Manchester and Glasgow.

In January, Vodafone claimed to be the first mobile operator in the U.K. to switch on its 5G Standalone (5G SA) network.

The telco said that selected customers in London, Manchester, Liverpool, Bristol, Bath, Glasgow and Birmingham – and who have Oppo Find X3/X5 Pro, Samsung Galaxy S21/S22 handsets on Unlimited Max plans – will be contacted by the operator to take part in the 5G SA trial.

Vodafone said it will also trial network steering, a technology that allows the network to direct a device automatically towards the right connectivity (4G, 5G NonStandalone or 5G Standalone), depending on what services are being used.

Other key mobile operators in the U.K include BT-owned EE and Virgin Media O2.