Three Eyeing to Bid for O2 Following UK Telecom Markets Mergers

Published By : 20 Jan 2015 | Published By : QYRESEARCH

Owners of UK’s leading mobile network, Three, are gearing up in a bid to rival for O2. The information came following BT’s announcement about its future plans to acquire EE, the largest network in UK.

According to a leading news daily, owner of Three, Hutchison Whampoa is already in early stages of talks with Telefonica to acquire O2. Hong Kong based tycoon Li Ka-shing controls Hutchison Whampoa. According to the latest reports, a bid as high as £9 billion has been proposed. The amount although is lesser than the investment of £12.5bn by BT’s to acquire EE, but the firm boasts a greater customer base and a larger 4G infrastructure. 

Market insiders are of the opinion that Telefonica may have taken the decision in order to exit the UK market and pay off their debts. BT was also keen to acquire O2 the previous year but with EE coming in the frame they had to decide on one between the two options. EE was a good deal for Three since they already have an existing network sharing deal in place, which is same in case of both BT and O2, but this was probably not enough to change Three’s decision. 

Hutchison Whampoa on the other hand shares its history with O2 since it purchased O2 Ireland back in 2013. 

One of the major concerns pertaining to the prevalent conditions in UK’s telecom market is that what would happen to its competitive environment. If the deal goes through, four out of five successful bidders in UK’s 4G spectrum auction will have merged. In a recent development Ofcom readily guaranteed 4G spectrum to Three in fear of losing out on the number of operators. 

Although there are a number of other operators in UK market like GiffGaff, Virgin Mobile, Tesco Mobile and but they run only on virtual network. 
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