The third and fourth largest mobile operators in Bangladesh, Robi and Airtel, are likely to merge to create the second largest operator in terms of subscriber-base.
Malaysia-based Axiata Group, the parent company of Robi Axiata and India-based telecom major Bharti Airtel, which owns Airtel Bangladesh, in a statement on Wednesday said that they had started talks to merge their Bangladesh operations.
As per discussion, in the proposed merger Airtel will be strategic minority partner and strengths of both companies will be combined to create the second largest mobile operator in Bangladesh with over 3.7 crore customers, reports Press Trust of India.
In a joint statement Bharti Airtel and Axiata said, ‘Axiata Group Berhad [Axiata] and Bharti Airtel Limited [Bharti] [collectively “Parties”] wish to announce that they have entered into an exclusive discussion to explore the possibility of combining the business operations of their telecommunication subsidiaries in Bangladesh, namely, Robi Axiata Limited and Airtel Bangladesh Limited.’
They, however, said, ‘There is no certainty that this discussion will lead into the execution of binding definitive agreements between the parties.’
‘This announcement is to facilitate the on-going discussions and exchanges of information between the Parties, including but not limited to discussions with the relevant regulatory authorities,’ said the statement.
An official of Robi told New Age that it was not yet certain whether the proposed deal would lead to a merger or acquisition of Airtel by Robi.
Robi with 2.7 crore subscribers and Airtel with 90 lakh lag behind leading operator Grameenphone which has 5.3 crore and Banglalink which has 3.2 crore subscribers as of July.
If Robi and Airtel merge, their combine subscriber base will surpass Banglalink.
Though Airtel Bangladesh does not make its financial details public, Indian media recently reported that Bharti Airtel was not happy with its Bangladesh unit’s performance and wanted to sell out the entity.
Indian television channel CNBC-TV on August 18 reported that Bharti Airtel had revived its plan to sell its Bangladesh and Sri Lanka operations and has appointed two bankers to conduct the sale.
‘The largest telecom operator in India plans to separate the tower business from the company and sell it first and the whole operation later, as part of a strategy to shun unproductive operations,’ according to the CNBC report.
The operator started looking for buyers for its operations in the two countries in 2012-13, but it was too early to get any buyer then, according to the report televised on August 18.
In 2010, Bhart Airtel bought a 70 per cent stake in Warid Telecom in Bangladesh for US$ 100,000 and re-branded it as Airtel Bangladesh.
The office of the Comptroller and Auditor General of Bangladesh raised questions about the deal price and accused that the government lost Tk 80 crore in revenue because of wrong valuation of the deal.
In 2013, Airtel bought the remaining 30 per cent shares at US$ 85 million.
Robi Axiata Limited is a joint venture company between Axiata Group Berhad, and NTT DOCOMO INC of Japan with Axiata leading with 91.59 per cent shares.
It was formerly known as Telekom Malaysia International which started operations in Bangladesh in 1997 under the brand name AKTEL.
On 28 March 2010, the service name was rebranded as ‘Robi’.
Robi earned a profit of Tk 90 crore in the second quarter of 2015 while Grameenphone earned Tk 512 crore profit in the same time.
Banglalink does not disclose its financial results.
Malaysia-based Axiata Group, the parent company of Robi Axiata and India-based telecom major Bharti Airtel, which owns Airtel Bangladesh, in a statement on Wednesday said that they had started talks to merge their Bangladesh operations.
As per discussion, in the proposed merger Airtel will be strategic minority partner and strengths of both companies will be combined to create the second largest mobile operator in Bangladesh with over 3.7 crore customers, reports Press Trust of India.
In a joint statement Bharti Airtel and Axiata said, ‘Axiata Group Berhad [Axiata] and Bharti Airtel Limited [Bharti] [collectively “Parties”] wish to announce that they have entered into an exclusive discussion to explore the possibility of combining the business operations of their telecommunication subsidiaries in Bangladesh, namely, Robi Axiata Limited and Airtel Bangladesh Limited.’
They, however, said, ‘There is no certainty that this discussion will lead into the execution of binding definitive agreements between the parties.’
‘This announcement is to facilitate the on-going discussions and exchanges of information between the Parties, including but not limited to discussions with the relevant regulatory authorities,’ said the statement.
An official of Robi told New Age that it was not yet certain whether the proposed deal would lead to a merger or acquisition of Airtel by Robi.
Robi with 2.7 crore subscribers and Airtel with 90 lakh lag behind leading operator Grameenphone which has 5.3 crore and Banglalink which has 3.2 crore subscribers as of July.
If Robi and Airtel merge, their combine subscriber base will surpass Banglalink.
Though Airtel Bangladesh does not make its financial details public, Indian media recently reported that Bharti Airtel was not happy with its Bangladesh unit’s performance and wanted to sell out the entity.
Indian television channel CNBC-TV on August 18 reported that Bharti Airtel had revived its plan to sell its Bangladesh and Sri Lanka operations and has appointed two bankers to conduct the sale.
‘The largest telecom operator in India plans to separate the tower business from the company and sell it first and the whole operation later, as part of a strategy to shun unproductive operations,’ according to the CNBC report.
The operator started looking for buyers for its operations in the two countries in 2012-13, but it was too early to get any buyer then, according to the report televised on August 18.
In 2010, Bhart Airtel bought a 70 per cent stake in Warid Telecom in Bangladesh for US$ 100,000 and re-branded it as Airtel Bangladesh.
The office of the Comptroller and Auditor General of Bangladesh raised questions about the deal price and accused that the government lost Tk 80 crore in revenue because of wrong valuation of the deal.
In 2013, Airtel bought the remaining 30 per cent shares at US$ 85 million.
Robi Axiata Limited is a joint venture company between Axiata Group Berhad, and NTT DOCOMO INC of Japan with Axiata leading with 91.59 per cent shares.
It was formerly known as Telekom Malaysia International which started operations in Bangladesh in 1997 under the brand name AKTEL.
On 28 March 2010, the service name was rebranded as ‘Robi’.
Robi earned a profit of Tk 90 crore in the second quarter of 2015 while Grameenphone earned Tk 512 crore profit in the same time.
Banglalink does not disclose its financial results.
Source: New Age
