REG - Vodafone Group Plc - Completion of Vodafone and Three merger in the UK

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RNS Number : 9028K  Vodafone Group Plc  02 June 2025

 

2 JUNE 2025

 Completion of Vodafone and Three merger in the UK

 

Vodafone Group Plc ("Vodafone") and CK Hutchison Group Telecom Holdings
Limited ("CKHGT"), a wholly owned subsidiary of CK Hutchison Holdings Limited
("CK Hutchison"), are pleased to announce that the merger of Vodafone UK and
Three UK successfully completed on 31 May 2025.

 

The combined business, named VodafoneThree, is 51% owned by Vodafone and 49%
by CKHGT. Vodafone will fully consolidate VodafoneThree in its financial
results, and the Chief Executive Officer is Max Taylor, who currently leads
Vodafone UK. Three UK's Darren Purkis is appointed Chief Financial Officer.

 

VodafoneThree will invest £11 billion over the next 10 years - creating one
of Europe's most advanced 5G networks, giving millions of customers and
businesses up and down the country a vastly superior mobile experience.

 

In its first year, VodafoneThree plans to invest £1.3 billion(1) in capex.
This will enable the company to accelerate its network deployment.
Consistent with previously communicated expectations, the combined business is
expected to deliver cost and capex synergies of £700 million per annum by the
fifth year after completion and the transaction is expected to be accretive to
Vodafone's Adjusted free cash flow from FY29 onwards. Full alignment to
Vodafone's accounting policies is ongoing and pro forma financials will be
provided in due course.

 

High quality network connectivity is critical to so many elements of daily
life. It is also central to the UK's economic growth prospects, important for
the UK's science and technology sectors, as well as for improving public
services and narrowing the digital divide across the country. This significant
investment in a 5G Standalone network will propel the UK's mobile
infrastructure to the forefront of European connectivity.

 

Margherita Della Valle, Vodafone Group Chief Executive, said: "The merger will
create a new force in UK mobile, transform the country's digital
infrastructure and propel the UK to the forefront of European connectivity. We
are now eager to kick-off our network build and rapidly bring customers
greater coverage and superior network quality. The transaction completes the
reshaping of Vodafone in Europe, and following this period of transition we
are now well-positioned for growth ahead."

 

 

Canning Fok, Deputy Chairman of CK Hutchison and Executive Chairman of CKHGT,
said: "As we have demonstrated in other European markets, scale enables the
significant investment needed to deliver the world-beating mobile networks our
customers expect, and the Vodafone and Three merger provides that scale.  In
addition, this transaction unlocks significant shareholder value, returning
approximately £1.3 billion in net cash to the Group."

- ends -

For media enquiries, please contact:

Vodafone Group
Plc
                        CK Hutchison Holdings Limited

Media Relations:
 
 
info@ckh.com.hk (mailto:info@ckh.com.hk)

Groupmedia@vodafone.com (mailto:Groupmedia@vodafone.com)
 
Headland Consultancy

Investor
Relations:
+ 44 (0) 20 38054822;

IR@vodafone.co.uk (mailto:IR@vodafone.co.uk)
 
Andy Rivett-Carnac:

+44 (0) 7968 997 365

 

Notes

1.   Proforma (12-month basis).

 

 

Other Notes to Editors

·    Expected impact of the merger on Vodafone Group's FY26 financials (on
a proforma full year basis): €0.4 billion incremental Adjusted EBITDAaL and
-€0.2 billion dilutive to Adjusted Free Cash Flow.

·    Subject to customary closing adjustments, VodafoneThree's net debt
immediately after completion is expected to be £6.0 billion (with Vodafone UK
contributing £4.3 billion of debt and Three UK contributing £1.7 billion of
debt respectively). As a result, on a fully consolidated basis, Vodafone
Group's net debt will increase by £1.7 billion (€2.0 billion).

·    Both parents have agreed to contribute £800 million of equity into
VodafoneThree to support the working capital requirements of the business
(£408 million from Vodafone and £392 million from CKHGT). £600 million of
this funding will be contributed shortly after closing, with the remaining
£200 million to follow in Q1 2026.

·    There have been no material changes affecting any matter contained in
previous announcements relating to this transaction made on 14 June 2023, 30
September 2024 and 9 December 2024.

 

 

 

 Registered Office: Vodafone House, The Connection, Newbury, Berkshire RG14
 2FN, England. Registered in England No. 1833679

About Vodafone

Vodafone is a leading European and African telecoms company. We provide mobile
and fixed services to over 340 million customers in 15 countries, partner with
mobile networks in over 40 more and have one of the world's largest IoT
platforms. In Africa, our financial technology businesses serve almost 88
million customers across seven countries - managing more transactions than any
other provider.

 

Our purpose is to keep everyone connected by using technology to improve
lives, businesses and help progress inclusive sustainable societies. We are
committed to reducing our environmental impact to reach net zero emissions by
2040.

 

For more information, please visit www.vodafone.com (http://www.vodafone.com)
follow us on X at @VodafoneGroup or connect with us on LinkedIn at
www.linkedin.com/company/vodafone.
(https://www.linkedin.com/company/vodafone/mycompany/verification/)

 

About CK Hutchison Holdings Limited

Listed on The Stock Exchange of Hong Kong Limited, CK Hutchison Holdings
Limited (CK Hutchison) is a renowned multinational conglomerate committed to
innovation and technology with businesses spanning the globe.  With
operations in about 50 countries/markets and over 300,000 employees worldwide,
CK Hutchison has four core businesses - ports and related services, retail,
infrastructure and telecommunications.  The Group is fully committed to its
environmental and social sustainability responsibilities with policies,
programmes and innovations across its businesses to address sustainability
challenges such as the net-zero transition.

 

CK Hutchison reported turnover of approximately HKD477 billion (USD61 billion)
for the year ended 31 December 2024.

 

For more information, please visit www.ckh.com.hk (http://www.ckh.com.hk)

 

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