Doha, September 21 (QNA) - HE Deputy Chief Executive Officer of Ooredoo Group Sheikh Mohammed bin Abdullah Al-Thani underlined that the Group seeks to conclude any deal and seize any opportunity to enhance the company's position, maximize shareholder benefit and serve customers.
Speaking at a press conference held today, HE the Deputy Chief Executive Officer of Ooredoo Group said that the proposed merger of telecoms brands, Indosat Ooredoo and Hutchison 3, is expected to be completed by the end of 2021, noting that the completion of the transaction will be subject to the approval of Ooredoo Group, CK Hutchison, Indosat Ooredoo shareholders, regulatory approvals and other customary terms and conditions.
He noted that the agreement to merge two outstanding telecoms brands, Indosat Ooredoo and Hutchison 3, was finalized after months of discussions. to create a new world-class digital telco for Indonesia.
HE said that the merged company will be called "Indosat Ooredoo Hutchison", and will consolidate its position as a stronger number 2 player in the Indonesian mobile market with revenues of around US$3 billion.
He underlined that the merger will deliver great benefits for Ooredoo Group and Indosat Ooredoo shareholders, customers, employees, and for Indonesia, noting that the economies of scale and the realization of synergies between these highly complementary businesses will mean the merged company is well placed to create more value for shareholders. He noted a significant enhancement in customer experience, as the merged company will be ready to drive the innovation and investment needed to deliver outstanding digital services across the country.
HE Deputy Chief Executive Officer of Ooredoo Group Sheikh Mohammed bin Abdullah Al-Thani also noted more opportunities for employees, as they will be part of a larger, financially stronger, more innovative digital technology company. For Indonesia, Indosat Ooredoo Hutchison will have the scale to support the countrys digital transformation and accelerate its economic recovery, he added.
He said that the merged company will retain the strong brands of Ooredoo and CK Hutchison; and its name, Indosat Ooredoo Hutchison, reflects the commitment of both companies to work together and use their combined expertise to continue to build on the outstanding growth momentum Indosat Ooredoo has delivered in recent years.
"This transaction is perfectly in line with our Group strategy to operate as top 2 player in each of our markets and will generate enhanced returns for the Group, resulting in sustainable profitability to elevate future dividend potential," he stressed.
He pointed to the positive response from financial analysts during the past few days following the announcement of the merger, who said that the transaction was "placed to deliver a higher return on investment for all shareholders", and that it "could be one of those rare deals where everyone wins something"; noting that this proves that this transaction is indeed positive for Ooredoo and strengthens the Group's market position.
HE Deputy Chief Executive Officer of Ooredoo Group Sheikh Mohammed bin Abdullah Al-Thani praised the Government of Indonesia for its progressive policies that enabled this merger and will allow for the creation of a more sustainable telecoms sector, which will ultimately benefit customers and shareholders.
He also commended Ooredoo teams and advisors for great efforts to conclude this agreement.
Ooredoo Group and CK Hutchison Holdings Limited had announced the signing of definitive transaction agreements for the proposed merger of their respective telecommunications businesses in Indonesia, Indosat Ooredoo") and H3I, to create a larger, commercially stronger and more competitive world-class digital telecoms and internet company, that is well placed to deliver more value for all shareholders, customers and for Indonesia. It will be the second largest mobile telecoms company in the country, with an estimated annual revenue of approximately US$3 billion.
Indosat Ooredoo and H3I own highly complementary infrastructure and the combination of these assets will also enable the merged company to benefit from cost and CAPEX synergies and provide accretive returns to all stakeholders. Annual run rate pre-tax synergies of approximately US$300-400 million are expected to be realized over 3-5 years.
In addition, Indosat Ooredoo Hutchison will be able to leverage the experience and expertise of Ooredoo Group and CK Hutchison in networks, technologies, products and services, and benefit from their multinational operations spanning major markets in Europe, the Middle East, North Africa, and Asia Pacific. The merged company will also benefit from their combined strength and economies of scale in functions such as procurement.
Ooredoo Group currently has a controlling 65.0% shareholding in Indosat Ooredoo through Ooredoo Asia, a wholly-owned holding company. The merger of Indosat and H3I will result in CK Hutchison receiving newly issued shares in Indosat Ooredoo amounting to 21.8% and PT Tiga Telekomunikasi Indonesia amounting to 10.8% of the merged Indosat Ooredoo Hutchison business.
Concurrent with the merger, CK Hutchison will acquire a 50% shareholding in Ooredoo Asia by exchanging its 21.8% shareholdings in Indosat Ooredoo Hutchison for a 33.3% stake in Ooredoo Asia, and will acquire an additional 16.7% stake from Ooredoo Group for a cash consideration of US$387 million. Following the above transactions, the Parties will each own 50.0% of Ooredoo Asia, to be renamed Ooredoo Hutchison Asia, which will retain a controlling 65.6% ownership stake in the merged company.
Upon closing of the transactions, Indosat Ooredoo Hutchison will be jointly controlled by Ooredoo Group and CK Hutchison. It will remain listed on the Indonesian Stock Exchange, with the Government of Indonesia retaining a 9.6% shareholding, PT Tiga Telekomunikasi Indonesia holding a 10.8% shareholding, and other public shareholders holding approximately 14.0%. (QNA)