Telecoms group Vodafone is in talks to combine its UK operations with its domestic rival Three UK, the mobile operator owned by Hong Kong infrastructure conglomerate CK Hutchison, people with direct knowledge of the matter said.
The deal, if it materialised, would herald the latest attempt to consolidate the British mobile market as Vodafone faces pressure from Europe’s largest activist investor, Cevian Capital, to simplify its business, pursue deals in national markets and improve returns.
A combination of Vodafone UK and Three UK would bring together the third and fourth largest mobile network operators in Britain, though any deal to reduce the number of leading brands from four to three would trigger scrutiny from competition authorities.