9 Sep 2019
Norwegian telecoms giant Telenor Group and Malaysian counterpart Axiata have announced that by mutual agreement they have called an end to discussions regarding a proposed non-cash combination of their respective telecom and infrastructure assets in Asia. Confirming the development via press release, the two companies noted that over the last four months both had worked on due diligence and finalising transaction agreements with a view to completing these in the third quarter of 2019. However, the parties have now elected to halt the talks citing ‘complexities involved in the proposed transaction’. Nonetheless, Telenor and Axiata said that they both still acknowledge the ‘strong strategic rationale’ of the deal that had been on the table and ‘do not rule out that a future transaction could be possible’.
As previously reported by TeleGeography’s CommsUpdate, in May 2019 the two operators announced that they had begun discussing a potential non-cash combination of their telecom and infrastructure assets in Asia, in which the former would take a majority stake. At that date they noted that under the terms of the proposed transaction Telenor would, based on equity value, own 56.5% of the new merged entity – referred to as MergeCo – with Axiata holding the other 43.5%. Outlining their reasoning for a potential tie-up, Telenor and Axiata said they were seeking to create a ‘leading, well diversified pan-Asian telco with operations in nine countries with a total population of close to one billion people’.