LONDON (Reuters) – Executives from Vodafone and CK Hutchison’s Three UK unit said their 15 billion pound ($18 billion) merger would benefit Britain’s consumers, infrastructure and jobs, as lawmakers scrutinise the planned tie-up.
Vodafone and Three UK have pledged to invest 11 billion pounds to build a 5G network for Britain as part of their bid to secure backing from politicians, unions and competition authorities for the merger announced in June.
Britain’s antitrust watchdog last week kicked off its examination of the deal, while lawmakers from the business and trade committee on Tuesday asked what the deal would mean for jobs.
“We believe that actually jobs will be created as a consequence of this merger both for building the network, and to create and support the IT systems, and to maintain this new network,” Vodafone UK’s corporate affairs and sustainability director Nicki Lyons said.
She said the companies were not giving numbers at this stage, and conceded that head office duplication could be an issue.
Trade union Unite has warned the deal will result in higher bills and job losses.
Representatives from both the companies said that as the current No. 3 and No. 4 players in Britain’s mobile market they did not have the scale to invest and compete against the two biggest operators, BT’s EE and VM O2, jointly owned by Telefonica and Liberty Global.
They warned that without the deal, Britain’s 5G network would continue to lag that of other European nations.
“Neither us nor Vodafone can invest sufficiently to build the type of 5G network that’s needed,” Three’s Chief Technical Officer David Hennessy said.
The two companies have long known that a proposed merger would face intense scrutiny from regulators who have previously opposed deals that reduce the number of networks in major markets from four to three.
But the tie-up would not result in price rises for consumers, said Three’s general counsel Stephen Lerner.
“We are not planning any increases in price,” he said, explaining the merged entity would be keen to price competitively to ensure it filled the new capacity it wants to build.
($1 = 0.8223 pounds)
(Reporting by Sarah Young; Editing by Mark Potter)
LONDON (Reuters) – Executives from Vodafone and CK Hutchison’s Three UK unit expressed their belief that their 15 billion pound ($18 billion) merger would ultimately benefit Britain’s consumers, infrastructure, and job market. This comes as lawmakers carefully scrutinize the planned merger which was announced in June. In order to secure support from politicians, unions, and competition authorities, Vodafone and Three UK have committed to investing 11 billion pounds in building a 5G network for Britain.
The examination of the deal was initiated by Britain’s antitrust watchdog last week, while lawmakers from the business and trade committee questioned the potential impact on jobs. Nicki Lyons, Vodafone UK’s corporate affairs and sustainability director, stated, “We believe that actually jobs will be created as a consequence of this merger both for building the network and to create and support the IT systems, and to maintain this new network.” However, Lyons acknowledged that head office duplication could be an issue and refrained from providing specific numbers at this stage.
Trade union Unite has expressed concerns about potential increases in bills and job losses resulting from the merger. Representatives from Vodafone and Three UK emphasized that as the current No. 3 and No. 4 players in Britain’s mobile market, they lack the scale required to invest and compete adequately against BT’s EE and VM O2 – the two largest operators jointly owned by Telefonica and Liberty Global. They warned that without the merger, Britain’s 5G network would continue to lag behind that of other European countries. Three’s Chief Technical Officer, David Hennessy, stated, “Neither us nor Vodafone can invest sufficiently to build the type of 5G network that’s needed.”
Both companies have long been aware that a proposed merger would face intense scrutiny from regulators who have historically opposed reducing the number of networks in major markets from four to three. However, the executives were adamant that the merger would not lead to price increases for consumers. Three’s general counsel, Stephen Lerner, assured, “We are not planning any increases in price.” He further explained that the merged entity would be motivated to price competitively in order to ensure the absorption of the new capacity they intend to build.
(Reporting by Sarah Young; Editing by Mark Potter)
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