Mobile phone giant Vodafone has agreed to merge British operations with Three UK, owned by Hong Kong-based CK Hutchison, to accelerate rollout of faster 5G connectivity, the pair announced Wednesday.
Expansion of 5G across the UK has been hampered by Britain's ban on Chinese giant Huawei, a major supplier of equipment for mobile telephone networks.
Vodafone and CK Hutchison said in a joint statement that a new combined group is seen having a value of £16.5 billion ($21 billion) following the deal's completion due by next year.
"The merger is great for customers, great for the country and great for competition," said Vodafone chief executive Margherita Della Valle, who recently cut 11,000 jobs at the group.
"It's transformative as it will create a best-in-class -- indeed best in Europe -- 5G network, offering customers a superior experience," she added.
The merger will lead to network investment of £11 billion over ten years, the statement said.
Canning Fok, group co-managing director of CK Hutchison, said the tie-up "will have the scale needed to deliver a best-in-class 5G network for the UK, transforming mobile services" for customers.
"This will unlock significant value for CK Hutchison and its shareholders, realise material synergies, reduce net financial indebtedness and further strengthen its financial profile," he added.
The transaction will see Vodafone take 51 percent of the combined group and CK Hutchison the rest.
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