The proposed deal would combine the companies’ telecommunications operations under one single network provider.
The CMA said it is now starting its formal investigation as it has received the required pre-notification evidence and information from both Vodafone UK and Three UK, as well as early views from stakeholders.
Sarah Cardell, chief executive, CMA, said, “This deal would bring together two of the major players in the UK telecommunications market, which is critical to millions of everyday customers, businesses and the wider economy.
“The CMA will assess how this tie-up between rival networks could impact competition before deciding next steps.”
Robert Finnegan, CEO, Three UK, commented, “We are confident that this transaction will deliver significant benefits to our customers, the country and competition, and we look forward to working closely with the CMA as they review our notification.”
Finnegan also stated that “joining forces” with Vodafone will “yield immediate benefits” for customers including “faster, more reliable coverage over more of the country”.
Ahmed Essam, CEO, Vodafone UK, added, “We strongly believe that the proposed merger of Vodafone and Three will significantly enhance competition by creating a combined business with more resources to invest in infrastructure to better compete with the two larger converged players.”
The CMA now has up to 40 working days to assess the deal as part of a Phase 1 investigation. This review is designed to identify whether the deal may lead to a “substantial lessening of competition”. The CMA will then decide whether a more in-depth Phase 2 investigation is required.