Axiata Group and Telenor signed the $15.8 billion final deal for the proposed merger of Celcom and Digi in Malaysia, to take on Maxis.
Last year, Axiata Group and Telenor dropped their plan to merge their global businesses due to difference in valuation.
Maxis is the #1 telecom operator in Malaysia. The combination of Malaysia’s second and third largest mobile services providers will create a company estimated to have annual revenue of $3 billion, with core profitability of $1.4 billion from a subscriber base of about 19 million, Axiata and Telenor said in a statement.
Axiata and Telenor have agreed to nominate Dato’ Izzaddin Idris as Chair, Jorgen C. Arentz Rostrup as Deputy Chair, Idham Nawawi as CEO and Albern Murty as deputy CEO of Celcom Digi.
Axiata and Telenor will be equal partners with 33.1 percent stake in Celcom Digi. Celcom Digi will remain listed on Bursa Malaysia Securities.
The cost and capex synergies will be around RM8 billion.
Celcom Digi aims to make an investment of up to RM250 million over five years in building an Innovation Center to be established in Kuala Lumpur with the aim to catalyse the 4IR digital transformation and strengthen the local ecosystem.
Completion of the deal will be subject to the approval of Axiata and Digi shareholders, regulatory approvals and other customary terms and conditions. The proposed merger is expected to be completed by the second quarter of 2022.
Morgan Stanley was the sole international advisor to Axiata on the deal, while Citi advised Telenor.