Vodafone and Hutchison Whampoa announced today they are to merge their Australian operations in a 50:50 joint venture that aims to be better able to take on the country’s two other dominant mobile operators. The move creates a company – to be renamed VHA Pty. Ltd. – with 6 million customers and combined total revenues of approximately A$4 billion (US$2.7 billion). In a statement, both companies said VHA will market its products and services under the Vodafone brand, but VHA will retain rights to use the 3 brand in Australia “during a transition period and thereafter.” Nick Read, current CEO of Vodafone Asia-Pacific & Middle East Region, will be Chairman of VHA, whilst CEO responsibility will be held by Nigel Dews (currently CEO of Hutchison Telecommunications Australia Limited and its 3G unit, Hutchison 3G Australia Pty Limited). The deal – expected to close by mid-2009 – involves a deferred payment to Vodafone of A$500 million to realise the difference in value between the two companies.

Vodafone Australia and 3 Australia are the third- and fourth-largest mobile operators in the country, respectively, trailing dominant players Telstra and Optus. According to Wireless Intelligence, 3 Australia controls only 9 percent of the Australian mobile market while Vodafone has a 17 percent market share. Telstra dominates, with a 41 percent market share, and also enjoys a huge 92 percent share of the HSPA market. Vodafone and Hutchison appear keen to address this shortfall via their merger; a joint statement said that “upon completion of additional network rollouts, VHA’s 3G population coverage is planned to increase to 95 percent,” supplying “an even broader product offering.”