Hutchison Seeks UK Govt Support for Three-Vodafone Merger Amidst Regulatory Scrutiny

Hong Kong conglomerate CK Hutchison’s senior leadership held discussions with British government officials last month to seek political support for the proposed merger of its Three UK mobile network with Vodafone UK. The deal is set to receive intense regulatory scrutiny from the Competition and Markets Authority (CMA), which will investigate the potential impact of reducing the number of networks from four to three. The report has been shared by Reuters.

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In October, Vodafone announced it was in talks with Three UK to combine their networks with an ownership split of 51% Vodafone and 49% CK Hutchison. The companies will argue that they need to join forces to afford the roll-out of standalone 5G networks, which the UK government has set an ambition to deliver to all populated areas by 2030.

The deal is likely to be announced amid rising bills for millions of customers across all four networks, with regulators seeking to maintain a competitive market. However, the risks of anti-competitive deals should not be understated, according to CMA’s boss Sarah Cardell.

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In February, Cardell stated in a speech titled “UK merger control in 2023” that a minimum of four operators in major markets has long been a tenet for regulators. CK Hutchison attempted to acquire Telefonica’s UK unit O2 seven years ago, but the deal was opposed by Britain’s telecoms regulator and blocked by the European Commission.