Finalising Three UK-Vodafone deal getting ‘extremely difficult’

CK Hutchison will likely finalise a deal on merging its Three UK mobile network with Vodafone’s in Britain, its chief financial officer Frank John Sixt said, but getting the deal over the line was “extremely difficult”.

The companies have been in talks since October to combine Britain’s third and fourth-largest networks in a deal that would be worth around 15 billion pounds ($18.9 billion) and an agreement had been expected imminently.

Sixt, however, signalled some issues still had to be agreed.

“It is probable as has been speculated that we will reach an understanding with our friends at Vodafone,” he told investors after a trading update on Tuesday.

“Although I would say they (Vodafone) are extremely difficult to draw a conclusion with on the one hand, but on the other hand they are, in the end, very good partners.”

“So the first part makes me a little bit more skeptical but the second part makes me a little bit more optimistic,” he added.

Sixt was more positive about Italy, where the company’s Wind Tre is nearing a deal to sell a majority stake in its infrastructure business to Swedish private equity firm EQT.

“I think it’s becoming pretty likely that you’ll see an announcement in a relatively short period of time in terms of a material development in Italy,” he said.

The British company, which appointed its interim chief executive, Margherita Della Valle, to the role permanently last month, has struggled to drive the consolidation it has said is needed in some of its major markets.

Hutchison’s senior leadership met British government officials in March to seek support for the deal, which will be subject to intense regulatory scrutiny, sources said. Reuters