CommsUpdate: Malaysian telecoms group Axiata has announced that the deadline for the proposed merger of its domestic subsidiary Celcom with Telenor-owned Digi has been pushed back.
The merger, which was scheduled to be completed on Tuesday, could now be delayed as far as the end of this year.
In separate filings to the local stock exchange, Bursa Malaysia Securities Berhad, both Axiata and Digi confirmed that they have agreed “to extend the date by which the conditions precedent set out in the share purchase agreement (SPA) are to be satisfied or waived in accordance with the terms and conditions of the SPA (‘Long Stop Date’) from 21 June 2022 to 31 December 2022, or such other date as mutually agreed in writing between the parties.”
Of note, it was confirmed that apart from the extension of the Long Stop Date, all other terms and conditions of the SPA remain unchanged.
As previously reported by CommsUpdate, Axiata, Telenor Asia and Digi.Com signed transaction agreements in June 2021 for the proposed merger of their Malaysian businesses, Celcom and Digi (to be known as ‘MergeCo’).
At the time, it was noted that on a pro forma basis. MergeCo will serve an estimated 19 million customers with revenue of MYR12.4 billion ($2.8 billion), EBITDA of MYR5.7 billion, net profit of MYR19.9 billion and free cash flow of MYR4 billion.
Axiata and Telenor will be equal partners in the enlarged company, with each taking a 33.1% ownership stake each in MergeCo, which will be listed on the Malaysian stock exchange.
Upon completion of the merger, Axiata will receive newly issued ordinary shares in Digi, representing 33.1% of the enlarged issued share capital of Digi, and cash consideration of MYR2 billion, of which approximately MYR1.7 billion will come from Digi as debt in MergeCo and approximately MYR300 million from Telenor as part of an ownership equalisation.
Be the first to comment