Ooredoo and CK Hutchison in talks to merge Indonesian units

4 Jan 2021

Reuters reports that Qatari telecoms company Ooredoo and Hong Kong conglomerate CK Hutchison have entered into talks to merge their Indonesian units – Indosat Ooredoo and Hutchison 3 Indonesia (Tri) – to allow them to better compete with larger players such as state-backed Telkomsel and Axiata-controlled XL Axiata. The two companies have reportedly entered into an exclusive non-legally binding memorandum of understanding (MoU), which is valid until 30 April 2021. The Qatar-based parent confirmed the development stating that it is ‘in the early stages of assessing the merits of such a potential transaction’, while CK Hutchison released a separate statement outlining that the potential transaction ‘is subject to due diligence, agreement on terms, signing of definitive agreements and obtaining all required corporate and regulatory approvals’.

TeleGeography notes that Indonesia recently passed a new law simplifying doing business and allowing spectrum-sharing between telcos – a move designed to stimulate consolidation in the market – which the government considers is needed ‘to support telco companies [as they] prepare their investment for the initial deployment of 5G in Indonesia’.

Indonesia, CK Hutchison, Hutchison 3 Indonesia (Tri), Indosat Ooredoo (incl. IM2), Ooredoo Group