Vodafone, Hutchison mobile merger complete

Vodafone Australia and Hutchinson Telecommunications - which owns the 3 network - have now merged their mobile phone businesses. Photo / AP

Hutchison Telecommunications and Vodafone have completed the merger of their Australian mobile communications businesses.

Hutchison and Vodafone merged their subsidiaries, Hutchison 3G Australia Pty Ltd and Vodafone Australia, to create a joint venture called Vodafone Hutchison Australia (VHA), in which they have equal shares.

The transaction gave Hutchison the right to convert all its convertible preference shares, which the company now was doing, Sydney-based Hutchison said in a statement.

Hutchison owns the '3' brand and Australia's fourth biggest mobile network while Vodafone is the third biggest.

Under the deal, Vodafone will receive a deferred payment of US$500 million ($809.58m) from VHA, by way of a shareholder loan from Vodafone to VHA, to equalise the value differences between the companies.

The loan is expected to be repaid or refinanced with 18 months from the completion of the merger.

The deal's completion follows approval by the Australian Competition and Consumer Commission in late May.

The combined network will be the third biggest in the country with revenue of about US$4 billion from six million customers and market share of about 27 per cent.

VHA will adopt Vodafone as the lead brand, although there are no plans to shed the 3 brand immediately.

Telstra Corporation is the market leader with about nine million subscribers, followed by Optus with about 7.6 million.

Hutchison also said that Kevin Russell had resigned as a director.

- AAP