Telefónica, the parent company of O2, has entered into exclusive talks with Hutchison Whampoa about the potential takeover of O2 UK.
It’s proposed a deal worth £10.25 billion in cash, with most of the money paid when the transaction is concluded. £1 billion would be deferred until cash flow reached an agreed figure.
The exclusivity period is due to last several weeks.
Hutchison Whampoa currently operates the Three UK network; combining the two companies would give it a customer base of around 35 million, making it the country's largest network operator.