Kuala Lumpur: Axiata Group Bhd and Digi.Com Bhd today said they had received clearance from the Malaysian Communications and Multimedia Commission (MCMC) to go ahead with the proposed merger between Celcom and Digi (MergeCo), which could create the largest mobile service operator in Malaysia.
Digi and Celcom are currently the second- and third-largest mobile service operators in the country.
In a joint statement today, the telcos announced that MCMC’s nod to the merger signifies that they will be advancing to the next phase of the transaction.
“Axiata and Digi are positive on the prospects of the proposed merger having passed a significant milestone in the ongoing approval process.
“Upon completion of the transaction, the parties look forward to realising the potential of the proposed merged company, which is expected to culminate in a stronger capacity to drive digitalisation in society broadly, for consumers, businesses, the partner ecosystem and for the development of local talent,” it said in the statement.
The merger application was submitted in July 2021 and has since gone through comprehensive assessments by the MCMC.
Previously, MCMC issued a Statement of Issues to the applicants in accordance with the mergers and acquisitions guidelines dated May 17, 2019 to address concerns that this merger will reduce competition in the communications market.
In response, the applicants had submitted an undertaking containing their commitment to addressing the competition issues highlighted by MCMC.
“MCMC had considered the commitment offered by the applicants and is satisfied that it will significantly reduce the competition issues that will or may arise as a result of this merger,” it said.
Axiata chairman Tan Sri Shahril Ridza Ridzuan today said that delivering improved network and connectivity for their customers is essential.
He said as two companies with a strong track record in contributing toward nation-building, they are excited about the digital inclusion and growth opportunities that MergeCo and a proposed Innovation Centre will catalyse.
“We look forward to playing an active role in encouraging national competitiveness through the provision of world-class connectivity and research platforms whilst also supporting the nation’s entrepreneurs and digital talents in the race to confidently position Malaysia for growth in the digital economy,” he said.
In the meantime, executive vice president and head of Telenor Asia, Jørgen Arentz Rostrup talked about realising the full potential of the merger.
“We have reached a positive milestone in the Malaysian merger process with this regulatory clearance. We are excited to move towards realising the full potential of bringing these two companies together, establishing a commercially stronger and more resilient digital service provider.
“With the proposed structural moves in Thailand and Malaysia, Telenor has a clear ambition to create future-fit companies that can better support ambitious national digital aspirations and bring new, advanced services to consumers across the region,” he said.
On April 8, 2021, Axiata dan Telenor Group announced that they were discussing the proposed merger between Celcom and Digi to form a new entity known as MergeCo, and that it was expected to be completed in the second half of 2022.
