O2 set for £10bn sale to Chinese company

A £10bn deal to create the UK’s largest mobile group with the sale of O2 to Hutchison Whampoa, which owns Three, could be announced as early as tomorrow morning.

Telefonica has been in talks to sell O2 since the end of 2014 and the final details were, according to the Financial Times, being hammered out tonight.

A deal to sell O2 to the Hong Kong-based Hutchison Whampoa is likely to be a concern to the regulator Ofcom because with fewer competing companies in the sector prices could rise.

The combined O2 and Three network could be forced to relinquish some of its broadcast spectrum to allow low-cost access by competitors such as Tesco Mobile and TalkTalk.

Merging O2 and Three would create an operator with 41 per cent of the market.