Virgin Media and O2 agree on $39 billion merger to create a new UK telecom giant
LIBERTY GLOBAL and Telefónica have struck a landmark deal to combine their British operations O2 and Virgin Media in a €29.995 billion agreement that will reshape the UK’s telecoms market. The two companies announced the deal on Thursday after five months of negotiations between the Spanish telecoms company and the US group controlled by billionaire John Malone.
The code name of the merger was ‘Project Pink.’ Under the terms of the agreement, the companies will have equal ownership of O2 and Virgin Media and have built-in mechanisms for a potential float of the combined business in three years.
The amount (€6.3 billion) will be used mainly by Telefónica to reduce the almost €38 billion euros of debt with which the company chaired by José María Álvarez-Pallete closed the 2019 financial year.