Vodafone and CK Hutchison Merge in Britain to Become the Country’s Largest Mobile Operator

Vodafone Group Plc and CK Hutchison have reached an agreement to merge their UK businesses that will create the country’s largest mobile operator.

The deal will amount to £15 billion ($19 billion).  The companies plan to complete the merger of the two businesses by the end of next year. Vodafone will control 51% of the shares, while CK Hutchison will receive 49% of the shares of the combined company.

Now Vodafone UK is second only to two mobile operators in the UK. The market leader is O2, followed by EE. They have approximately 24 million and 22 million subscribers.

The combined company intends to invest £11 billion ($14 billion) in the development of networks in the UK. But for this the deal must be approved by regulators, who may not like the reduction in the number of operators from four to three.

The companies added that “the transaction is expected to result in significant efficiencies. It is expected that by the fifth full year after completion, the synergy between annual costs and capital investments will be more than £700 million.”