Vodafone will own the majority of the business with 51 per cent, while CK Hutchison will own 49 per cent. The firms first announced they were in talks last October, but the finalised merger agreement will now trigger a lengthy review process by UK regulatory boards.
In 2021, the Competition and Markets Authority approved the proposed merger between Virgin Media and O2. But a previous attempt by Three to buy O2 in 2016 was blocked by the European Commission over concerns that it would reduce competition for UK consumers.
The new deal will help the two firms compete with others in the sector to continue the rollout of their 5G network, which will be able to reach 99 per cent of the population once the deal is confirmed.
Aiming to complete the deal by 2024, Margherita Della Valle, chief executive of Vodafone, said it was a “gamechanger” that would be “great for customers, great for the country and great for competition".
“As a country, the UK will...