The UK’s Competitions and Markets Authority (CMA) has formally approved the proposed merger of Telefónica’s O2 and Liberty Global’s Virgin Media.
The merger, which was first announced in May 2020, promises to create a major UK competitor to BT which can compete across both mobile and fixed-line telecommunications.
The deal values O2 at £12.7 billion and Virgin Media at £18.7 billion, giving the group a combined value of £31.4 billion. It will be a 50:50 joint venture and led by Virgin Media boss Lutz Schüler.
In a statement, the CMA’s panel chair Martin Coleman said: “After looking closely at the deal, we are reassured that competition amongst mobile communications providers will remain strong and it is therefore unlikely that the merger would lead to higher prices or lower quality services.”
The CMA had previously provided provisional approval for the deal, but this latest green light means that the final hurdle has now been overcome. The deal is expected to close by June 1.
Liberty Global CEO Mike Fries and Telefónica CEO José Maria Alvarez-Pallete said in a joint statement:“This is a watershed moment in the history of telecommunications in the UK as we are now cleared to bring real choice where it hasn’t existed before, while investing in fibre and 5G that the UK needs to thrive.”