The wind has changed? Britain backstabbed Li Ka-shing

Author | Cat brother

Source | Big Cat True Detective Agency

Li Ka-shing has encountered new trouble, and it is related to an investigation.

In June 2023, the UK's telecommunications industry launched a merger and acquisition case, with Vodafone UK (Vodafone) and Three UK (3UK) in the UK reaching an agreement to prepare for a merger, with Vodafone holding 51% of the shares and Changhe owning 49%.

Although Vodafone is a telecom giant, it can only rank third in the UK market share, and 3UK ranks fourth, but if the two sides merge, the total number of users will be 27 million, which will reach the first place in the UK.

The British are worried.

Why?

Because 3UK is controlled by the Li Ka-shing family's Cheung Wo Group, and the Cheung Ho Group is in Hong Kong, and Hong Kong belongs to China.

The deal then descended into a lengthy investigation.

1. Anti-monopoly investigation, because the British side feels that the current competition pattern of the four companies is very good, and there is no need to become three, of course, the main reason is that it is afraid of rising telecommunications costs;

2. "National security" investigations, this is the focus.

In 2022, the UK enacted a "National Security and Investment Act", specifically targeting some so-called sensitive industries, and the UK government can review related investments and mergers and acquisitions.

The logic is very clear:

Vodafone has a lot of government public projects in its hands, and it is also an operator of submarine cables, while 3UK does not, and although 3UK is headquartered in the United Kingdom and carries out British business, Changhe is in Hong Kong, and the Li Ka-shing family has expressed its support for the Hong Kong National Security Law, so the Li Ka-shing family is China's agent, and if the two sides merge, then China will be able to obtain government secrets from Vodafone through Changhe, which is controlled by the Li Ka-shing family.

Use "national security" to oppose "national security", and the British double standard should not be too slippery.

Both investigations seem important, but why is the so-called "national security review" the focus?

Because, the first survey, in fact, is not very valid.

In 2016, 3UK wanted to acquire O2, the second largest operator in the United Kingdom, for 10.25 billion pounds, and the merger of the two parties could probably increase the market share to 30%-40%.

However, the deal was blocked by the European Commission for a similar reason: after 4 to 3, there was less competition, which hindered infrastructure construction and raised prices for users, and was suspected of monopoly.

The reasons for the European Union at that time, 731 pages were written.

However, the deal fell through, and the UK's infrastructure has not progressed, and according to data cited by the British Guardian, the average speed of 5G in the UK is already at the bottom of the G7 countries.

In 2020, the European Commission overturned the ban on 3UK and O2 takeovers, and to some extent, the original so-called monopoly fears do not seem to be valid.

The merger of the second and fourth is not a monopoly, but the merger of the third and fourth is a monopoly, even if Vodafone and 3UK both shout a loud slogan, "Great for country".

In addition to expanding the UK's 5G network, it will also provide an investment of £11 billion, providing 8,000-12,000 jobs in the UK.

Even the British media have called for regulators to be pragmatic, and the three major players may be more able to compete fully and be more beneficial to consumers.

It should have been a good thing, but as a result, how did it turn out that China wanted to steal British secrets?

For Li Ka-shing, this is a bad start.

After all, Li Ka-shing's investment in the UK is deeply rooted in all aspects of the British, after all, Changhe's key areas in the UK include infrastructure, telecommunications, and retail.

According to British media, at the peak of investment, the Li Ka-shing family once controlled about 1/4 of the UK's electricity distribution market, nearly 30% of the natural gas supply market, nearly 7% of the water supply market, more than 40% of the telecommunications market, nearly one-third of the British docks, and more than 500,000 square meters of land resources.

The Li family's layout in the UK has been more than 20 years, bringing one large investment after another to the UK.

In the past, even if the Li family "bought half of the United Kingdom", Britain greeted them with a smile, but now, it has become a "Chinese agent".

Once the suspicion is opened, then in the future, for the Li family, who are heavy in the UK, the scrutiny they may face will follow, especially the review of the relationship with China, even if the nationality of Li Zeju, one of the Five Eyes Alliance, is Changhe's current speaker, Canada.

Of course, since 2020, the Li family has begun to sell assets in the UK, such as the UK Power Network, although it has not been successfully sold, but it has been put on the shelves.

This time, the Li family was forced to make another weather vane.

If Britain really played that game, the Li Ka-shing family might really be the biggest victim.

Of course, it may also be a hurdle for Chinese enterprises going overseas.