Telecom major Bharti Airtel and Malaysian firm Axiata have deferred the agreement for merger of their Bangladesh operations till September 26, 2016.
The merger of their Bangladesh business was earlier expected to be completed in the first half of this year.
“Bharti Airtel Limited and Axiata Group Berhad, have on June 24, 2016, agreed to further extend the Agreement until September 26, 2016, or such other date as the parties may agree,” Airtel said in a regulatory filing with reference to its earlier announcement relating to the merger.
Axiata Group Berhad and Airtel on January 28 this year signed a Definitive Agreement to merge their respective telecom subsidiaries — Robi Axiata Ltd and Airtel Bangladesh Ltd — in Bangladesh.
According to industry sources, the enterprise valuation of the merged entity is estimated to be around USD 2 billion.
Upon completion of the merger, Axiata will hold 68.3 per cent controlling stake and Bharti Airtel 25 per cent, while the remaining 6.7 per cent will be held by the existing shareholder — NTT Docomo of Japan.
Post-merger, the combined entity operating as ‘Robi’ will serve approximately 40 million customers.
Airtel had entered Bangladesh by acquiring 70 per cent stake in Warid Telecom in 2010. Subsequently, it picked up the remaining 30 per cent too in 2013.
The merger is expected to result in improving the cost of operations and business viability that will lead to greater returns to the shareholders.
Like this report? Sign up for our daily newsletter to get our top reports.