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UK’s CMA Launches Antitrust Review of Vodafone-Three Merger

 |  January 28, 2024

The Competition and Markets Authority (CMA) in Britain has initiated an antitrust review into the proposed merger between Vodafone and the Three UK mobile network, owned by CK Hutchison. The investigation, announced on Friday, will primarily focus on determining whether the merger would result in a “substantial lessening of competition,” according to a statement from the U.K. Competition and Markets Authority.

The proposed transaction, agreed upon last year, would see Vodafone acquiring a 51% ownership stake in the combined business, with CK Hutchison retaining a minority stake. If the initial probe identifies concerns about competition, the CMA has the authority to proceed with a more thorough investigation.

“This deal would bring together two of the major players in the UK telecommunications market, which is critical to millions of everyday customers, businesses, and the wider economy,” stated CMA CEO Sarah Cardell. “The CMA will assess how this tie-up between rival networks could impact competition before deciding next steps.”

Related: EU Approve Vodafone-CK Hutchison £19 Billion Merger in the UK

Vodafone has been undergoing a leadership transition since the departure of former CEO Nick Read at the end of 2022. Margherita Della Valle was appointed as the permanent CEO in April to spearhead the transformation of the business. The proposed merger, if approved, would be led by the current Vodafone UK CEO, Ahmed Essam, with the present Three UK Chief Financial Officer (CFO) Darren Purkis taking on the CFO role at the merged entity.

The merger between Vodafone and Three UK would result in a reduction of mobile operators in the country from four to three, marking a significant consolidation in the telecommunications sector over the past few years. The CMA now has a 40-working-day window to assess the deal thoroughly before deciding on the next course of action.

The outcome of this antitrust review will undoubtedly shape the landscape of the UK telecommunications industry, and stakeholders eagerly await the CMA’s findings in the coming weeks.

Read more: CNBC