CK Hutchison agreed a €2.45 billion ($2.86 billion) deal with Veon to acquire a 50 per cent stake in Wind Tre, in a deal which will give the Hong Kong-based conglomerate sole ownership of the Italian operator.

Explaining the move in a statement, CK Hutchison said the agreement represented a “key step” in consolidating an important part of its telecoms assets, while giving it a larger presence in what it described as an “attractive market”.

In its own statement, Veon said it expects to book a net gain of $1.1 billion from the deal and intends to use the proceeds to pay down debt. It has also made a bid to acquire Global Telecom Holding’s assets in Pakistan and Bangladesh, and will use some of the proceeds from the Wind Tre sale to fund the deal. Veon is seeking to boost its emerging markets presence by acquiring GTH’s Pakistani operator Jazz and Banglalink in Bangladesh for a combined $2.55 biliion.

Hutchison’s move to secure a larger share in Italy follows France-based Iliad’s entry to the market in May. The company has already stepped up competition with aggressively priced promotions, putting pressure on rivals Telecom Italia, Vodafone Italia and Wind Tre to also cut prices.

The deal builds on the merger of Veon’s (then known as VimpelCom) Wind entity with CK Hutchison’s 3 Italia in 2016, which gave both companies an equal 50 per cent ownership in the combined entity.

In 2017, CK Hutchison said Wind Tre contributed over €1 billion to group EBITDA and committed to continue “driving synergies from the integration of the combined businesses” as a result of the acquisition.

Canning Fok, group co-managing director of CK Hutchison, said becoming the sole owners of Wind Tre gives it “the strongest possible platform to drive increased and recurring value for our shareholders”.

The deal is subject to regulatory approvals in the EU and Italy and is expected to close in Q3. Notably, it took more than a year for the 2016 merger between 3 Italia and Wind to complete.