Three owner set to bid for O2 UK
20 January 2015 | 0
Hutchison Whampoa, owners of UK mobile network Three, is following up its acquisition of O2 in Ireland with a bid for the rival’s UK operation.
The moves follows BT’s announcement that it will acquire EE, the UK’s largest network, it seems more moves in the telecom industry are poised. According to the Sunday Times,
Hutchison Whampoa is controlled by the Hong Kong tycoon Li Ka-shing and the report suggests a bid as high as £9 billion (€11.8 billion) is being proposed. That’s less than BT’s £12.5 billion buyout of EE but the firm has more customers and a larger 4G infrastructure.
It is thought that Telefonica may be looking to exit the UK market to pay off debts.
BT was initially eyeing up O2 as a potential deal last year but EE then entered the frame so the firm had the pick of the two. EE might have been a better deal for Three since with an existing network sharing deal in place and the same with BT and O2 but it looks like that wasn’t enough to swing it.
One of the big questions is what is happening to competition in the UK telecoms market as if this deal goes through, four out of five successful bidders in the 4G spectrum auction will have merged. Ofcom effectively guaranteed Three 4G spectrum in fear of reducing the number of operators.
Hutchison Whampoa’s acquisition of O2 Ireland was only passed by EU regulators after it was promised the combined operation would provide consumers with additional choice in the form of two mobile virtual network operators (MVNOs) using their technology to deliver a branded service.
Late last year UPC announced it would be offering a mobile service on the combined O2/Three network.