Tens of millions of mobile phone users could end up paying more if the merger between Vodafone and Three goes ahead, the competition watchdog has warned.

The deal would create the UK’s biggest mobile network but could also improve network quality, the Competition and Markets Authority (CMA) said.

The CMA will now consider how the companies could address those concerns.

The regulator had announced an in-depth investigation in April over fears the merger could “result in a substantial lessening of competition”.

Mobile phone users could face higher prices and reduced quality of service if the plans went ahead, it added.

The proposed £15bn merger, announced last year, would bring 27 million customers together under a single provider.

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