Hutchison Whampoa agrees definitive terms to acquire O2 in the UK from Telefónica
Hutchison Whampoa has agreed definitive terms to acquire O2 in the UK from Telefónica. The deal agreed is the result of a period of exclusive discussions between the two companies.
Telefónica stated that a definitive agreement has been reached after completion of due diligence over O2 UK. The parties agreed on a purchase price of £10.25 billion (Euro 14 billion). The price is composed of an initial amount of £9.25 billion and an additional deferred payment of £1 billion to be paid once the cumulative cash flow of the combined company in the UK has reached an agreed threshold.
Telefonica commented in statement: “We are pleased to be integral to such an exciting ambition and are confident that as a result of the deal, UK customers will benefit from greater value, quality and innovation. We also fully expect that new and exciting opportunities will open up for employees of both businesses.
“The deal is subject to regulatory approvals which might take up to a year. In the meantime, our priority is to continue to look after our customers, delivering the very best experience that they have come to expect from O2.”
Completion of the transaction is subject, among other usual conditions, to the approval of regulatory authorities and the obtaining of waivers to certain change of control provisions. The Conditions must be satisfied by no later than 30 June 2016, unless specified circumstances as set out in the share purchase agreement arise, then this date may be extended to 30 September 2016.