DTAC and True prepare Thai telecoms mega-merger
The respective owners of Thai telecoms operators True and DTAC are in the process of closing a deal that could see the two companies merge, which will pave the way for the creation of a combined company with around 55 million customers.
Telenor, the Norwegian owner of DTAC, and True parent CP Group, have agreed to explore the creation of a new company comprising their telecommunications companies in Thailand with the aim of creating a “leading telecommunications service provider capable of accelerating Thailand’s Progressive Digital Technology Program. â.
It is estimated that the pro forma revenues of the resulting combined entity, which would be a self-proclaimed “telecommunications technology” company, would amount to approximately US $ 6.9 billion in 2020 alone.
True and DTAC are already individually among the largest mobile network operators in Thailand.
âThe telecommunications and technology sectors are essential to enable Thailand to move up the development curve and create prosperity on a large scale,â said Suphachai Chearavanont, CEO of CP Group and chairman of True Corporation.
âAs a telecommunications technology company, we can help unleash the huge potential of Thai companies and digital entrepreneurs, as well as attract more of the best and brightest from around the world to do business in our country. ”
âToday is a step forward in this direction. We hope to empower a whole new generation to realize their potential to become digital entrepreneurs by leveraging advanced telecommunications infrastructure.
âThe emergence in Thailand of IoT, AI, cloud and new generations of mobile network technologies will have a huge effect on how we do everything,â he said.
For Telenor, which earlier this year sold its mobile telecommunications business in Myanmar amid political unrest in that country, there are expected to be significant opportunities in Asia stemming from digitization and advancements. techniques in the years to come.
As such, the proposed transaction is believed to advance Telenor’s value-driven strategy to strengthen its presence in Asia.
âThe proposed transaction will advance our strategy to strengthen our presence in Asia, create value and support long-term market development in the region,â said JÃ¸rgen A. Rostrup, Executive Vice President of Telenor Group and director of Telenor Asia.
âWe have a long-standing commitment to Thailand and the Asian region, and this collaboration will further strengthen it. Our access to new technologies as well as to the best human capital will be a vital contribution to the new business, âhe added.
As reported by the Bankok Post, the proposed merger is expected to be reviewed by the National Broadcasting and Telecommunications Commission (NBTC).
However, if the transaction is successful, it will consist of a conditional voluntary takeover bid (VTO) for all outstanding shares of DTAC and True, followed by a merger of the two companies.
Depending on the tender in the VTO, Telenor and CP Group will aim for an ownership share of around one third each in the merged entity. The company will also be listed on the Thailand Stock Exchange.
DTAC and True will continue to manage their businesses independently until the transaction is finalized, with the respective parties aiming to complete the necessary agreements by the end of the first quarter of 2022.
The transaction remains subject to the approvals of the boards of directors and relevant shareholders, as well as customary regulatory approvals.
In September, Telenor doubled down on its decision to withdraw from Myanmar by selling its business in the ailing country, expressing deep concern at the “deteriorating” human rights and security situation in the country.
In July, just days after trying to quell rumors it was considering selling its Myanmar mobile business, Telenor revealed that it had reached a deal to sell its Telenor Myanmar subsidiary to Lebanese conglomerate M1 Group for 105 millions of dollars.
The move came after months of hardship for Telenor Myanmar and, indeed, all other telecommunications operators in the country, after the Burmese military declared a state of emergency in February, subsequently cutting off the internet. mobile across the country.
Tags TelcoThailandTelenorDTACCP GroupTrue