Vodafone and Three UK have agreed to merge their UK operations, creating the country’s largest mobile phone network with a value of £15 billion.
The deal, which is expected to close by the end of 2024, will see Vodafone own 51% of the combined business and Three’s parent company CK Hutchison own the remaining 49%.
Vodafone will also have the option to buy out CK Hutchison’s stake three years after the merger, subject to a minimum valuation of £16.5 billion.
The companies said the merger will create a “strongly competitive third scaled operator” that will invest £11 billion in the UK over the next decade to build one of Europe’s biggest 5G networks.
They also promised to create up to 12,000 new jobs in the UK and reach more than 99% of the population with their 5G standalone network by 2034.
The merger will also generate “substantial” cost savings, although the firms did not disclose how many jobs or offices might be affected by the deal.
Vodafone and Three UK have a combined customer base of about 27 million and more than 11,500 staff in the UK.
They said the deal will help them compete with their larger rivals Virgin Media O2 and BT’s EE, which have around 24 million and 20 million mobile customers respectively.
Margherita Della Valle, chief executive of Vodafone, said: “This is a gamechanger for the UK and its ambitions to be a centre for future technology.”
She added: “The merger is great for customers, great for the country and great for competition.”
The deal is subject to regulatory approvals and consultations with employees and other stakeholders.