Regulator to investigate merger of Vodafone and Three

A planned merger between Vodafone and Three UK, which would create the UK’s largest mobile phone operator, will undergo an in-depth investigation by the competition regulator.

The Competition and Markets Authority (CMA) said the £15bn deal could lead to “higher prices” and “reduced quality” for customers. Both companies have five working days to provide “meaningful solutions” to concerns that the merger will result in higher prices for consumers and businesses, but lower investment. The CMA said competition would help keep prices low. “Whilst Vodafone and Three have made a number of claims about how their deal is good for competition and investment, the CMA has not seen sufficient evidence to date to back these claims,” said Julie Bon, the CMA’s initial investigator. “These warrant an in-depth investigation unless Vodafone and Three can come forward with solutions.” The watchdog said the deal could also make it difficult for smaller mobile operators to negotiate good offers for their own customers by reducing the number of network operators to host them.

Vodafone UK’s chief, Ahmed Essam, said: “By merging our two companies, we will be able to invest £11bn to help the UK realise its ambitions to be a world leader in next-generation 5G technology and increase competition across the industry.”

Three UK’s chief executive officer, Robert Finnegan, said: “The current market structure is holding the UK back, which is not good for customers or competition.

“By creating a third player with the necessary scale to invest, the combination of our two companies will deliver one of Europe’s most advanced networks.”