The Teleco companies Telenor , Axiata and Digi sign merger agreements of Celcom and Digi brand which will serve 19 million customers.
The integration planning phase will include further detailed work on synergies and business plan of MergeCo, and initial estimates indicate potential value accretion through cost and capex synergies of around RM8 billion on a net present value basis.
The President & Group Chief Executive Officer of Axiata Dato’ Izzaddin Idris, said:
“We are charting good progress in the ongoing merger exercise with Telenor and Digi and remain aligned in our intentions to deliver a strong value proposition that will enable our customers to participate more confidently as the nation transitions towards a digital economy.
“We look forward to delivering better value and choices to benefit society, especially in bridging the divide in rural areas and assisting the Home and Enterprise businesses take advantage of new opportunities in this digitally accelerated environment.”
From the aspect of Malaysia’s national interests, Axiata and key Malaysian institutional shareholders are expected to own more than 51 percent of MergeCo at completion.
Axiata and Telenor also reiterated their commitment to protect employee welfare with no forced retrenchments. MergeCo is slated to create opportunities for staff to continue to develop across functions, build new competence and be part of future growth of the merged company.
At completion, the merger of Celcom and Digi will result in Axiata receiving newly issued ordinary shares in Digi, representing 33.1 percent of the enlarged issued share capital of Digi, cash consideration of RM2.0 billion of which approximately RM1.7 billion will come from Digi as debt in MergeCo and approximately RM300 million from Telenor as part of an ownership equalisation under the terms of the proposed merger.
