DHAKA, May 6, 2019 (BSS) – Malaysia-based company Axiata, the parent
company of the second largest mobile network operator (MNO) in Bangladesh
Robi, is going to have business stake of the leading MNO Grameenphone.
Both the parent companies in a statement today announced their
engagement in talks on a potential non-cash merger of their telecom and
infrastructure assets in Bangladesh and other eight Asian countries to serve
nearly 300 million customers using approximately 60,000 towers.
To this end, Norwegian Telenor Group, the parent company of
Grameenphone, and Axiata Group after a successful negotiation would form a
“MergeCo” to have operational headquarters in Malaysian capital Kuala
Lumpur.
However, Robi clarified Axiata’s announcement and said “Robi will not be
part of the proposed merger and shall remain a direct subsidiary of Axiata’s
post completion of the proposed transaction”.
Both the parties acknowledging that this is preliminary subject to
adjustments and due diligence and said “It is anticipated that Telenor, based
on equity value, will own 56.5 percent in MergeCo while Axiata will own 43.5
percent.”
Telenor said: “There is no certainty that these discussions will result
in any transaction agreement between the parties.”
MergeCo would have its operational headquarters in Kuala Lumpur housing
the majority of functions, and would be listed at an international stock
exchange as well as on Bursa Malaysia.
In Malaysia, the intention is to merge Celcom and Digi, with MergeCo as
the majority owner. Robi in Bangladesh, which is jointly owned by Axiata with
Airtel, would continue separately and independently managed by Axiata.
By uniting two organizations with complementary footprints and a “merger
of equals spirit”, there will be opportunities to benefit from synergies
estimated at around US$ 5 billion. This would also support future investments
and create shareholder value, the companies said.
MergeCo would take an active role in accelerating technological
modernization and digitization in Malaysia and throughout Asia, and plans to
establish the Malaysian Research and Innovation Centre for developments such
as 5G, Internet of Things (IoT) and artificial intelligence.
Telenor’s Asian footprint covers Thailand (Dtac), Malaysia (Digi),
Bangladesh, Pakistan and Myanmar. Besides, Axiata has operating companies in
Malaysia (Celcom), Bangladesh (Robi), Cambodia (Smart), Nepal (Ncell), Sri
Lanka (Dialog) and Indonesia (XL), and the tower business Edotco.
Pro-forma revenue and pre-synergy EBITDA of MergeCo is approximately US$
13 billion and US$ 5.5 billion.