The $19 billion merger of Vodafone and Three has been approved by UK regulators – with conditions

The UK Antitrust Authority did just that Green light The long-planned merger between two of the country’s largest telecom operators.

Vodafone and Three make up two of the four mobile network operators (MNOs) that own infrastructure in the UK, along with O2 and EE. As such, when the duo unveiled plans to merge in a $19 billion deal last June, it was always likely to attract scrutiny. The Competition and Markets Authority (CMA) began its initial “phase one” investigation in January, before progressing matters to a full in-depth investigation in June, after conducting market analysis and gathering industry feedback.

Then, in September, the CMA delivered its interim findings, concluding that the merger would lead to higher prices for consumers, diminished services and reduced investment in UK mobile networks. But it stopped short of blocking the deal, instead suggesting potential solutions to allay its concerns.

Which brings us to today, where the CMA has finally approved the deal – with conditions. It said the two companies must sign binding commitments to “invest billions” to launch a joint 5G network across the UK. In the short term, the CMA also said the new combined entity will have to cap “certain mobile phone tariffs” for three years. While Mobile Virtual Network Operators (MVNOs) will also continue to have pre-determined contractual terms for the same period.

These obligations will be overseen by the CMA and Ofcom, the UK’s competition and regulatory body for the telecommunications industry.

“It is important that this merger does not harm competition, which is why we have spent some time considering how it will impact the telecoms market,” Stuart McIntosh, chairman of the CMA’s inquiry, said in a statement. statement. “Having carefully considered the evidence, as well as the comprehensive feedback we have received, we believe that the merger is likely to enhance competition in the UK mobile sector and should be allowed to go ahead – but only if Vodafone and Three agree to implement our proposed actions.”