3 & Vodafone Hook Up Down Under

Apparently not a sign of things to come elsewhere...

This has left one of my eyebrows in a painfully raised position…

Despite global mobile phone networks being amongst the most disparate areas of technology the news this week that 3 and Vodafone have merged in Australia is something of a surprise.

Both companies will share a 50 per cent stake in the new brand, renamed ‘VHA’, but will market its products and services under the Vodafone name. The 3 brand expected to continue only for the length of the transition period while Vodafone will also receive a deferred payment of A$500 million to equalise the value difference between the two businesses.

“This transaction will benefit customers in Australia as it creates a company with the necessary scale to compete strongly in the mobile market,” said Vodafone CEO Vittorio Colao.

“Combining with the strengths of Vodafone in Australia means that our partnership will deliver leading propositions, products and services to Australian businesses and consumers across the full range of their mobile communications needs,” added 3 managing director Canning Fok (yes, I know – but too easy).

The merger will create one of the largest Australian telcos with approximately 6m customers and combined revenues of around A$4bn. 95 per cent of the population will also be covered and 63 per cent of them will have access to a 3G signal. Current Vodafone Asia-Pacific & Middle East CEO Nick Read will become chairman of VHA and the transaction is expected to close by mid 2009.

A sign of things to come elsewhere? Hopefully not. After all, never forget: competition is key…

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