Newbury's Vodafone unveils new network sharing agreement with Virgin Media O2

Newbury-headquartered Vodafone has unveiled a new long-term network sharing agreement with Virgin Media O2, which expands on its existing pact.

The communications titan said it would "extend and enhance" the existing agreement for more than a decade, "bolstering quality mobile coverage across the country and delivering improved services for customers".

READ MORE: Vodafone–Three merger under scrutiny from Competition and Markets Authority

It comes as the proposed £15 billion merger between Vodafone and Three is currently being considered by the Competition and Markets Authority (CMA).

Vodafone said the agreement and merger will transform the experience for tens of millions of customers across the UK and, subject to CMA approval, would "rebalance the mobile market by creating a third scaled network operator".

"Many elements of the agreement expand on the existing arrangement between Vodafone UK and Virgin Media O2 and are independent of the Vodafone UK and Three UK merger outcome. However, subject to completion of the merger, the operators have agreed that Virgin Media O2 will acquire spectrum from the newly created MergeCo, establishing three scaled mobile network operators each with better alignment of spectrum holding," it added.

Reportedly, such a move could potentially address the CMA's concerns about the proposed merger, which is set to reduce the number of mobile networks in Britain to three from four.

Ahmed Essam, CEO, European Markets, Vodafone said: "The proposed merger, together with this agreement, will boost competition by establishing a strong third player in the UK mobile market and will improve the balance of spectrum holdings, levelling the playing field between the UK's mobile operators."

Lutz Schüler, CEO of Virgin Media O2, added: "We are extending and bolstering elements of our existing network sharing arrangement, while also ensuring there is a robust, balanced and functional structure in place for the long-term should Vodafone and Three's proposed merger gain consent.

"We believe that this new agreement addresses the issues we have voiced and the CMA outlined in its initial decision, and will now continue our engagement with the regulator in this spirit."