O2 and Virgin Media merge to converge

Telefonica and Liberty Global have announced a merger of their respective UK operations - O2 and Virgin Media - in a deal that will value the combined entity at £30 billion. Under the new joint venture, each parent will have equal representation on the board. The transaction is expected to close in mid-2021, subject to regulatory review. While the UK telecoms market is already one of the most dynamic and competitive in the world, this deal will inject further impetus into the convergence strategy that has grown in popularity across the US and Europe over the last five years - albeit with mixed results. It also lends credence to the economic value of infrastructure scale as 5G and fibre rollouts take place against a challenging macro environment.