UK mobile operators Three and O2 are in the “final days” before signing a four-to-three merger agreement, with a deal possible within the week, two sources said.
Spokespeople for Telefonica and Three UK declined comment.
On 23 January, the Hong…
UK mobile operators Three and O2 are in the “final days” before signing a four-to-three merger agreement, with a deal possible within the week, two sources said.
Spokespeople for Telefonica and Three UK declined comment.
On 23 January, the Hong Kong and Spanish companies announced that they had entered exclusive talks, with a view to creating the UK’s largest mobile operator.
At that time, the parties had agreed that Hutch would pay £10.25bn (US$15.4bn), of which £9.25bn would be paid at closing, with a further £1bn once the combined business hit an undisclosed cash flow target.
Since then, Hutch, owned by Asia’s richest man Li Ka-shing, has been undertaking due diligence.
Many legal experts expect that the issue of network sharing will play a big role in any competition review, since O2 and Vodafone have an existing agreement on one hand, while 3 and EE have another in place.
The general view is that these agreements will have to be “unpicked”, while there is another theory that joined-up networks might in fact benefit consumers by offering the best possible service.
Last year, Hutchison said Three had 9.7 million customers in the UK split between pre-paid and post-paid contracts, while Telefonica said O2 has 24 million mobile accesses.
Berenberg estimates that a merged O2-Three would have 41% of the UK mobile market, followed by EE with 32% and Vodafone with 24%.
