Under the terms, Vodafone will own 51% and Hutchison 49% of the combined group, which will be led by current Vodafone UK boss Ahmed Essam. The finance chief of Hutchison's Three UK, Darren Purkis, will take the same role in the new group. The combined operator will have about 27 million customers, overtaking BT's (BT.L) EE and VM O2, jointly owned by Telefonica (TEF.MC) and Liberty Global (LBTYA.O). Vodafone, which is currently Britain's third-biggest mobile operator, and fourth-placed Hutchison will have options which would allow Vodafone to acquire the Hong Kong-based conglomerate's 49% stake in the future. Shares in Vodafone, which fell to a 25-year low of 71 pence on Tuesday, rose 3.6% after the deal was announced.

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Persons: CK Hutchison, Canning Fok, Ahmed Essam, Darren Purkis, Hutchison, Vodafone's Essam, Robert Finnegan, Gail Cartmail, Paul Sandle, Clare Jim, Kate Holton, Sharon Singleton, Kirsten Donovan Organizations: Vodafone, CK, HK, Hutchison, Hutchison's, BT's, VM O2, Telefonica, Liberty Global, Britain's Competition, Markets Authority, CMA, Unite, Thomson Locations: HONG KONG, Britain, Hong Kong, China, London