Robi Axiata And Airtel Bangladesh To Merge Bangladesh Operations

Robi-Axiata-And-Airtel-Bangladesh-To-Merge-Bangladesh-Operations

Gopal Vittal, managing director and CEO (India and South Asia), Bharti Airtel

Axiata Group and Bharti Airtel today signed a Definitive Agreement to merge telecom subsidiaries Robi Axiata and Airtel Bangladesh in Bangladesh.

The agreement follows the September 9, 2015 announcement of both parties entering into an exclusive discussion to explore possibility of combining the business operations in Bangladesh.

Post-merger, the combined entity operating as Robi will serve approximately 40 million customers. The joint strengths of Robi and Airtel will deliver the widest mobile network coverage across Bangladesh, strengthening its position in the mobile internet segment as well as consolidating its position as the second largest operator in the country.

The proposed transaction is subject to conditions precedent including receiving applicable approvals from relevant authorities and is expected to complete in the first half of 2016.

The telecommunications landscape in Bangladesh has been one of high-growth albeit intensively competitive with six players. The proposed merger is set to strengthen the industry structure, competitiveness and, more importantly, bring greater benefits to customers in terms of network quality and coverage and an improved offering of data products and services.

Upon completion, Axiata will hold 68.3 percent controlling stake in the combined entity, while Bharti will hold 25 percent. The remaining 6.7 percent will be held by the existing shareholder, NTT DOCOMO of Japan.

Synergies Due To Robi Axiata and Airtel Bangladesh
Delivering widest network coverage and superior mobile internet experience to 40 mn customers
Creating wider sales and distribution reach supported by the large customer service centers across the country
Rewarding customers through lower within-network (on-net) call rates
Improving affordability of mobile services through the enhanced scale of combined operations
Secure faster nationwide rollout of mobile broadband and contribute to overall economy and revenue
Improved scale of operations leading to better business viability and shareholder returns

Supun Weerasinghe, chief executive officer, Robi said, “The highly competitive and crowded Bangladesh telecommunications sector solicits consolidation and we believe this merger will form greater economies of scale for both Groups. Additionally, it will result in shared investment capacity of the leading two industry players to optimise strategies and deliver enhanced value to consumers, benefitting the industry at large.

Dato’ Sri Jamaludin Ibrahim, president and group chief executive officer, Axiata said, “In line with Axiata’s merger and acquisition strategy, in-country consolidation has been one of the Group’s key focus in solidifying its position, unlocking profitability of the market and ensuring long term growth. Axiata’s track record of successful strategic mergers and integrations in its other markets such as Indonesia, Sri Lanka and Cambodia further qualifies the Group to lead market consolidation in Bangladesh.”

“The country is an important market to us. Axiata’s investment in Bangladesh dates back to 1996. As with all our investments in the region, Axiata is committed to the long term growth and development of Bangladesh, not only within the telecommunications industry but also in terms of our contribution to the economy, people and growth of Bangladesh,” added Ibrahim.

Gopal Vittal, managing director and CEO (India and South Asia), Bharti Airtel said, “There is a compelling rationale for bringing together the strengths of both entities. The combined entity will be well positioned to leverage the operational synergies to serve customers better with world-class services and contribute to the growth of the telecommunications sector in Bangladesh.”

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