BackAirtel, Axiata defer Bangladesh business merger pact
Upon completion of the merger, Axiata will hold 68.3 % controlling stake and Bharti Airtel 25 %, while the remaining 6.7 % will be held by the existing shareholder
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New Delhi: Telecom major Bharti Airtel and Malaysian firm Axiata have deferred the agreement for merger of their Bangladesh operations till 26 September, 2016.
The merger of their Bangladesh business was earlier expected to be completed in the first half of this year. “Bharti Airtel Limited and Axiata Group Berhad, have on 24 June, 2016, agreed to further extend the Agreement until 26 September, 2016, or such other date as the parties may agree," Airtel said in a regulatory filing with reference to its earlier announcement relating to the merger.
Axiata Group Berhad and Airtel on 28 January this year signed a Definitive Agreement to merge their respective telecom subsidiaries —Robi Axiata Ltd and Airtel Bangladesh Ltd—in Bangladesh.
According to industry sources, the enterprise valuation of the merged entity is estimated to be around $2 billion. Upon completion of the merger, Axiata will hold 68.3% controlling stake and Bharti Airtel 25%, while the remaining 6.7% will be held by the existing shareholder—NTT Docomo of Japan.
Post-merger, the combined entity operating as ‘Robi’ will serve approximately 40 million customers. Airtel had entered Bangladesh by acquiring 70% stake in Warid Telecom in 2010.
Subsequently, it picked up the remaining 30% too in 2013. The merger is expected to result in improving the cost of operations and business viability that will lead to greater returns to the shareholders.
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