The CMA told Vodafone and Three on 22nd March that they had until 2nd April to address its competition concerns or face a full investigation.
The regulator said that they needed to provide “meaningful” solutions to concerns the merger, which was announced last year, would result in higher prices and reduced quality of service for customers. On 28th March, both parties informed the CMA that they would not be offering any such undertakings.
The CMA said today that it was launching the phase 2 probe “on the basis that, on the information currently available to it, it is or may be the case that this merger may be expected to result in a substantial lessening of competition within a market or markets in the United Kingdom”.
The firms said in a joint statement, “This was an expected next step in the process and is in line with the timeframe for completion that we set out from the outset.
“Vodafone UK and Three UK remain confident that the transaction will drive stronger competition in the mobile sector and give customers and businesses a step-change in network quality, speed and coverage from day one.”
They added, “We will review the potential concerns raised by the CMA and look forward to continuing to engage constructively with them throughout the review.”
The CMA started the first phase of its probe into the joint venture agreement in January. The investigation, overseen by an independent panel, will take at least 24 weeks and could result in the merger being blocked. The regulator has until 18th September to carry out the investigation.
If it goes through, the proposed merger would bring 27 million customers together under a single provider and create the UK's largest mobile network.