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Virgin Media and O2 join £ 31 billion deal to create the largest British operator

After starting the negotiation process in December 2019, Liberty Global and Telefonica now close an agreement to create the largest telecommunications operator in the United Kingdom. The £ 31 billion business foresees the merger between Virgin Media and O2 into a new company that will become a rival to operators like BT or Vodafone.

Virgin Media, which belongs to Liberty Global, is valued at £ 18.7 million and Telefonica's O2 is worth £ 12.7 billion. Bloomberg advances that Telefonica receives an initial payment of around £ 2.5 billion, with an additional 5.7 million in future recapitalizations.

The new operator that will be controlled in equal parts by the operators. And each one can appoint four members to the board of directors. Upon completing the merger, the company will have a combined total of 46 million subscribers, as well as 11 billion pounds of revenue.

The deal will be officially closed in mid-2021 and will allow Virgin Media to deepen business in the 5G area based on O2's experience. In addition, the merger between operators will allow Telefonica to reduce its debt by more than 38 billion euros.