Vodafone CEO: Three UK deals will ‘take as long as it takes’ Vodafone’s CEO said a long-awaited 15 billion pound ($19 billion) merger with CK Hutchison’s (0001. HK) Three UK mobile network is “progressing” but not yet, dimming hopes of a deal.
After Hutchison’s leadership team met British government officials in March, sources said a deal was close to combining Britain’s third and fourth-largest networks.
Vodafone and Hutchison argue they need to merge to fund the 5G networks the British government needs, but reaching an agreement has been difficult.
“It will take as long as it takes to get a good deal,” Vodafone CEO Margherita Della Valle told reporters on Tuesday, adding that the tie-up had a “strong rationale” and would benefit customers.
Last week, Hutchinson was cautious, reversing March comments by co-managing director Canning Fok that talks were nearing completion.
“I would say they (Vodafone) are extremely difficult to draw a conclusion with on the one hand, but on the other hand they are, in the end, very good partners,” Hutchinson’s Chief Financial Officer Frank John Sixt remarked last week.
Vodafone must close the transaction to boost growth. As a result, it announced 11,000 job cuts on Tuesday and a 1.5 billion euro free cash flow drop.
The British group has indicated consolidation is needed in big areas including Britain and Italy, while it may depart Spain after a strategic review.
Vodafone stated no transaction with Hutchison was guaranteed.
At a time when Britain’s regulator has blocked transactions, the tie-up is set to face harsh antitrust scrutiny. It banned Microsoft’s Activision acquisition last month.
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