Vodafone Group chief executive Margherita Della Valle has said the newly elected Labour government will fall behind on its 5G target if the carrier's £15 billion ($19.25bn) merger with Three in the UK is blocked.
In an interview with The Guardian, Della Valle said that Labour will fail to achieve its promise of nationwide access to the technology if the merger does not go ahead.
The UK’s next big telco merger - Vodafone and Three?
Will four become three in the UK? Advanced talks between Vodafone and Three have got the industry talking about a potential merger and its chances of success.
The previous UK government under the Conservative Party approved the deal in May.
Labour hasn't commented publicly on the M&A, but did note in its election manifesto that nationwide coverage of 5G was needed by the end of the decade because the UK was falling behind other countries in the rollout of the technology.
Earlier this year, an Opensignal study revealed the UK ranked 22nd out of 25 European countries for 5G availability and download speeds.
"Everyone now talks about [things like] artificial intelligence, all of these things cannot happen without good networks,” Della Valle told the publication.
"All policymakers understand now the importance of having good quality networks. Look at Labour’s manifesto, for example … nationwide 5G by 2030. There is no doubt that a catalyst is needed to get there because it’s not going to be done [by the current market]."
In April, the Competition and Markets Authority (CMA) initiated, as expected, a Phase 2 investigation into the deal noting that it will run until September 18, 2024.
If approved, it will create the UK's biggest telco with more than 27 million customers.
The CMA has argued that the deal would give less choice to consumers, as the number of telcos reduces from four to three.
The merger will give Vodafone a 51 percent majority stake in the combined entity, currently labeled as "MergeCo," with CK Hutchison's Three holding the remaining 49 percent.
UK trade union Unite has previously labeled the merger "reckless," and urged the government to intervene. It's said that a deal will lead to job losses for UK staff at Vodafone and Three.
Last year, Vodafone announced plans to cut 11,000 jobs worldwide over the next three years.
