The merger between the UK mobile networks of Vodafone and Three has been completed.

The combined business, named Vodafone Three, is 51% owned by Vodafone and 49% by CK Hutchison Group Telecom Holdings (CKHGT), the previous owner of Three (www.three.co.uk) in the UK.

Vodafone will fully consolidate Vodafone Three in its financial results, and the chief executive officer is Max Taylor, who currently leads Vodafone UK. Three UK’s Darren Purkis is chief financial officer.

Vodafone Three will invest £11bn over the next ten years, creating one of Europe’s most advanced 5G networks, giving millions of customers and businesses up and down the country a better mobile experience.

In its first year, Vodafone Three plans to invest £1.3bn in capex. This will enable the company to accelerate its network deployment. Consistent with previously communicated expectations, the combined business is expected to deliver cost and capex synergies of £700m per annum by the fifth year after completion and the transaction is expected to be accretive to Vodafone’s adjusted free cash flow from 2029 onwards. Full alignment to Vodafone’s accounting policies is ongoing and pro forma financials will be provided in due course.

Both partners have agreed to contribute £800m of equity into Vodafone Three to support the working capital requirements of the business (£408m from Vodafone and £392m from CKHGT); £600m of this funding will be contributed shortly after closing, with the remaining £200m to follow early next year.

High quality network connectivity is critical to so many elements of daily life. It is also central to the UK’s economic growth prospects, important for the UK’s science and technology sectors, as well as for improving public services and narrowing the digital divide across the country. This significant investment in a 5G Standalone network should propel the UK’s mobile infrastructure to the forefront of European connectivity.

“The merger will create a new force in UK mobile, transform the country’s digital infrastructure and propel the UK to the forefront of European connectivity,” said Margherita Della Valle, Vodafone (www.vodafone.com) chief executive. “We are now eager to kick-off our network build and rapidly bring customers greater coverage and superior network quality. The transaction completes the reshaping of Vodafone in Europe and, following this period of transition, we are now well-positioned for growth ahead.”

Canning Fok, executive chairman of CKHGT (www.ckh.com.hk), added: “As we have demonstrated in other European markets, scale enables the significant investment needed to deliver the world-beating mobile networks our customers expect, and the Vodafone and Three merger provides that scale. In addition, this transaction unlocks significant shareholder value, returning approximately £1.3bn in net cash to the group.”