Three becomes one as Vodafone buys out merger partner

NETWORKS

£4.3B deal gives telco full control of Britain's largest mobile operator

Vodafone has paid £4.3 billion ($5.78 billion) for the remaining 49 percent of VodafoneThree, taking full ownership of the UK's largest mobile operator.

The telecoms giant announced that it planned to buy the stake held by Three's former parent, CK Hutchison Group Telecom Holdings, in May.

The acquisition comes just over a year after Vodafone UK and Three UK completed their merger following conditional approval from the Competition and Markets Authority (CMA).

The merger reduced the UK market to three mobile network operators: VodafoneThree, BT/EE, and Virgin Media O2 (VMO2).

Vodafone claims full ownership will help it move faster and capture the "significant benefits" of an £11 billion ($14.7 billion) network investment plan and its "targeted synergies." These include £700 million ($942 million) in annual cost and capital expenditure savings expected by the 2030 financial year.

The £11 billion investment plan was a condition of the CMA's approval. The watchdog had expressed doubts that the companies would honor their pledges without binding commitments.

Vodafone Group chief Margherita Della Valle said: "With full ownership and control, we'll have the ability to move faster in the next phase of building one of Europe's leading networks. This best-in-class infrastructure will deliver better connectivity for our customers up and down the country, help drive the UK's digital economy, and deliver long-term value for our shareholders."

We asked Vodafone whether VodafoneThree will simply become Vodafone at some point, given that it owns the entire business now, and how long the Three brand will continue to exist (the Three website is still online at the time of writing).

A spokesperson told us the company was happy with its multi-brand strategy and had no plans to change the VodafoneThree name or drop Three, VOXI, SMARTY, or Talkmobile.

Vodafone will hold an investor briefing on October 8 to outline VodafoneThree's strategy, growth ambitions, and "the value it expects to deliver over the coming years."

PP Foresight founder and analyst Paolo Pescatore told The Register that the move is good news for subscribers.

"Having a single owner should simplify decision-making, accelerate investment, and reduce some of the complexity that can come with a jointly owned business," he said.

CCS Insight director of Consumer and Connectivity Kester Mann told us the deal is an endorsement of the strong start made by the merged company.

"A full buyout by Vodafone was always on the cards but the agreement has come sooner than expected, with the joint venture only just into its second year," he said.

Mann added that it reinforced the widely held industry view that Vodafone will prioritize its own brands over Three's.

Elsewhere, Della Valle reportedly told the company's annual general meeting this week that Vodafone intends to begin UK beta testing of its direct-to-device satellite service in early 2027.

Vodafone had originally intended to offer a commercial direct-to-cell satellite service in Europe in 2025 using the AST SpaceMobile orbital network. But those plans have been subject to delays, such as the loss of one of AST SpaceMobile's BlueBird satellites due to a fault with Blue Origin's New Glenn rocket that was carrying it.

A Vodafone spokesperson said beta testing depended on AST SpaceMobile having at least 45 satellites in orbit, a milestone now scheduled for early 2027.

In the meantime, VMO2 has beaten it to market, launching its Starlink-powered O2 Satellite direct-to-device service in February. ®