Vodafone seals £8.4bn merger of its Australian operations with local company TPG Telecom
- Vodafone Hutchison Australia and TPG will merge into a new group
- It is set to challenge Australia’s two biggest telecoms firm, Telstra and Optus
- Vodafone Group shares down 2.7 per cent at 168.24p following the news
Vodafone’s Australian operations will become part of a new group as an AUS$15billion (£8.4billion) merger with TPG Telecom was agreed today.
Vodafone Hutchison Australia and TPG will merge into a new group which is set to challenge Australia’s two biggest telecoms companies, Telstra and Optus.
Vodafone Australia, owned by Hong Kong-based CK Hutchison and Vodafone Group, will have a majority 50.1 per cent stake in the merged group. TPG will hold the remaining 49.9 per cent stake.
Mammoth merger: Vodafone Hutchison Australia and TPG will merge into a new group
Vodafone Hutchison is the third largest mobile operator in Australia, with a mobile customer base of approximately 6million subscribers.
TPG has Australia’s second largest fixed line residential subscriber base of over 1.9million customers.
The new group will have combined revenues of more than AUS$6billion (£3.4billion) and underlying earnings of more than AUS$1.8billion (£1billion).
Nick Read, chief executive designate of Vodafone, said: ‘This transaction accelerates Vodafone’s converged communications strategy in Australia and is consistent with our proactive approach to enhance the value of our portfolio of businesses.
‘The combined listed company will be a more capable challenger to Telstra and Optus, and will be much better placed to invest in next-generation mobile and fixed-line services to benefit Australian consumers and businesses.’
The merger is expected to be completed in 2019, subject to regulatory and shareholder approval.
Vodafone Group shares were down 2.7 per cent at 168.24p.