Hong Kong conglomerate Hutchison Whampoa is in early talks with Telefónica to acquire mobile operator O2 in the UK for an estimated US$13.6bn (stg£9bn).
Hutchison Whampoa, which owns Three in Ireland and last year acquired O2 in Ireland for around €850m, has hired UBS AG to explore options to acquire O2.
The move comes after BT last month entered into exclusive negotiations to acquire Everything Everywhere from Orange for stg£12.5bn. BT originally sold its mobile network O2 to Telefonica in 2005 for stg£18bn.
The O2 network is the second largest in the UK with over 22m subscribers.
An initial takeover plan of O2 by Hutchison Whampoa was at first dismissed but later waved through by EU competition watchdogs. However, Hutchison had a change of heart.
But now it looks like the deal could be back on.
Acquiring O2’s UK network would consolidate Three as one of the largest mobile operators in the UK and increase its footprint in Europe where it is also active in Italy, Sweden, Denmark, Austria and Ireland.
The move is part of a wider trend of consolidation in the global telecoms market. It emerged last month that global fixed and mobile telecoms operator Vodafone is eyeing up opportunities to expand its fibre footprint and has its eyes on Liberty Global, the cable giant which also owns UPC and Virgin Media.
The O2 in London image via Shutterstock