Vimpelcom and Hutchison agreed to combine their Italian mobile operations in a 50-50 joint venture in a long-awaited deal to consolidate Europe’s fourth-largest telecom market.

The companies promised that the deal would deliver cost savings worth more than 5 billion euros, most of which would come from combining the two mobile networks.

The new company would have more than 31 million mobile customers and 2.8 million fixed-line customers, they said in a joint statement on Thursday.

It will compete with Telecom Italia and Vodafone in a market reduced to three players if regulators approve the deal.

“The combined entity will have significant footprint and the deal will accelerate innovation and investment in Italy since the joint venture will be better positioned to compete,” Vimpelcom CEO Jean-Yves Charlier said at a news conference.

The companies expect the deal to close in 12 months if antitrust authorities wave it through.

Maximo Ibarra, the current chief executive of Vimpelcom’s Italian unit called Wind, will lead the new entity.

(Reporting by Danilo Masoni and Leila Abboud; editing by Jason Neely)

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