XL Axiata plans to buy Axis shares from Saudi Telco, merge unit - Exclusive | Company data
(The Insider Stories) – Indonesian telecommunication operator PT XL Axiata (IDX:EXCL) plans to merge with privately owned PT Axis Telekom Indonesia to increase its share of the cellular and data markets, two people familiar with the matter say. The transaction will require approval from the government.
Malaysian operator Axiata Group Bhd. (KL:AXIATA), which owns XL Axiata, is in talks with Axis’s majority owner Saudi Telecom Co. (SASEIDX:STC) for Axiata to acquire STC’s shares and then merge the units, in line with Indonesian regulations. The deal is expected to close next month.
Saudi Telco owns 84% of Axis while Malaysia’s Maxis Bhd. (MK:MAXIS) owns the rest of the company, worth at least $880 millon, according to an estimate by Saudi Fransi Capital.
XL Axiata currently has 46 million subscribers while Axis 5.9 million. The merger will increase the healthiness of competition in Indonesia’s crowded cellular market, where 10 operators vie for market share, and alleviate price wars.
