Hutchison Whampoa in exclusive talks to buy O2 for £10.25bn
Telefonica has announced that it is in exclusive talks with Hong Kong-based Hutchison Whampoa, operator of the Three network, to offload its UK subsidiary O2 for £10.25bn.
Should the all-cash deal go ahead during an exclusivity period, set to last several weeks, it would make the combined group the single largest mobile operator in Britain – although definitive agreements and due diligence have yet to be reached.
In a statement Telefonica said: “This operation marks another step in Telefónica’s transformation process, initiated by the company to become a leading digital telco and accelerate sustainable long-term growth while maintaining an attractive remuneration policy.
“Additionally, this announcement occurs at a decisive moment for Telefónica, following a period during which the company has been proactively managing its portfolio of assets, significantly reinforcing its position in key markets (consolidating Germany, acquiring GVT in Brazil -pending regulatory approvals - or undertaking a commercial and technological revolution in Spain) and therefore increasing its potential for future growth.
“Finally, today’s agreement shows that Telefónica continues to lead the European consolidation process and it will allow the company to strengthen its financial flexibility.”
Britain’s mobile telecoms landscape is presently dominated by four main providers; Telefonica, Three, Vodafone and EE but pressures have been building to consolidate these operations.