The UK Competition and Markets Authority (CMA) has announced its final approval of the 50:50 joint venture between Liberty Global and Telefónica to combine Virgin Media and O2.
All regulatory conditions have been met in accordance with the original terms and the transaction is now expected to close on June 1, 2021. The CMA provisionally authorized the transaction last month, with no recourse required, after the Commission Europe to forward it to the CMA.
Telefónica and Liberty Global announced the creation of the joint venture last May, bringing together Virgin Media, the UK’s fastest broadband network, and O2, the country’s largest and most admired mobile platform.
The combination will create a stronger fixed and mobile competitor in the UK market, supporting the expansion of Virgin Media’s giga-ready network and O2’s 5G mobile deployment for the benefit of consumers, businesses and the public sector. The joint venture is expected to produce substantial synergies valued at £ 6.2bn based on net present value after integration costs and will create a nationwide integrated communications provider with £ 11bn of revenue.
Liberty Global and Telefónica announced last month the appointment of Lutz Schüler as Chief Executive Officer and Patricia Cobian as Chief Financial Officer of the combined company upon completion of the transaction. Schüler is currently CEO of Virgin Media and Cobian, Chief Financial Officer of O2.
José María Álvarez-Pallete, Chairman of Telefónica and Mike Fries, CEO of Liberty Global, commented: “This is a defining moment in the history of telecommunications in the United Kingdom as we are now authorized to present a real alternative where there has not existed before, as we invest in fiber and 5G, something the UK needs to thrive. We thank the CMA for conducting a thorough and efficient review. Lutz and Patricia are ready to take the reins and launch a national connectivity champion that will bring more people together, drive more businesses to grow again, and stimulate more communities for the common good.”