Via Yahoo Finance

One of Britain’s biggest mobile networks O2 will merge with cable TV and broadband company Virgin Media to create a £31bn ($37.8bn) media and telecoms giant.

The parent companies of both entities confirmed on 4 May that discussions over a possible combination were underway. On Thursday, the groups confirmed the tie-up.

“We couldn’t be more excited about this combination,” said Mike Fries, chief executive officer of Virgin Media owner Liberty Global.

“Virgin Media has redefined broadband and entertainment in the UK with lightning-fast speeds and the most innovative video platform. And O2 is widely recognised as the most reliable and admired mobile operator in the UK, always putting the customer first.”

Jose Maria Alvarez-Pallete, chief executive of O2 owner Telefónica (TEF.MC) also said: “Combining O2’s number one mobile business with Virgin Media’s superfast broadband network and entertainment services will be a game-changer in the UK, at a time when demand for connectivity has never been greater or more critical.

“We are creating a strong competitor with significant scale and financial strength to invest in UK digital infrastructure and give millions of consumer, business and public sector customers more choice and value.”

Spanish phone company Telefónica took over O2 in 2006 and operates in 14 countries. O2 is one of Britain’s largest mobile networks, and also supports operators Tesco Mobile, Giffgaff and Sky Mobile. Virgin Media provides cable TV, phone and broadband services, and also has mobile customers but uses other companies’ networks.

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