As someone else here said, Apple would 100% call this bluff. And you can be certain the UK won't have the US to put pressure on Apple for them. All the would happen is the UK Apple users would be with an expensive paperweight.
All evidence that I have seen suggests that consumers by and large do not care about this kind of privacy. They do not buy iPhones instead of other phones due to the privacy properties.
Therefore Apple's shareholders could order Apple to stay in the UK market.
And if not, then Apple's customers could be compensated with money and other UK-held assets that the government could confiscate.
[1] https://www.nasdaq.com/market-activity/stocks/aapl/instituti...
You may be right, of course. But if there's one tech company who _might_ say "no", it's Apple.
Counterpoint: Apple in China.