Heaptalk, Jakarta – Two giant telecommunication groups, OOREDOO QPSC (Ooredo) and CK Hutchison Holdings Limited (CKHutchison), officially announced the signing of a definitive transaction agreement to merge their telecommunication business in Indonesia on Thursday (16/09). The combination of part of these two groups, PT Indosat Tbk (ISAT) and PT Hutchison 3 Indonesia (Tri Indonesia), produced a behemoth company which, further, was named PT Indosat Ooredoo Hutchison Tbk (Indosat Ooredoo Hutchison).
The deal performed by these groups is mentioned has a merger transaction value at about US$6 billion, leading Indosat Ooredoo Hutchison as the second largest telecommunication company in Indonesia. Moreover, the great synergy from these two groups is projected will potentially bring annual income up to US$3 billion.
Responding to this strategic deal, the Managing Director of Ooredoo Group Aziz Aluthman Fakhroo stated that the agreement is a vast leap to attain the mutual vision of both groups in creating an exceptional value to customers and shareholders. Performing this measure will create a perfect combination that possesses powerful pillars, including business scale, financial ability, and great competencies to win the business competition.
“This (deal) is backed by two business companies that strongly keep their commitment, namely Ooredoo Group and CK Hutchison. By the agreement, now we can focus on completing the transaction and cooperate to CK Hutchison to pour out the expertise of each group to build a world-class digital communication company.”
Additionally, in line with Aziz’s statement, the Group Co-Managing Director of CK Hutchison Holdings Canning Fok affirmed that the merger would create more resilient and innovative telecommunication companies in Indonesia, even deliver add-value to both shareholders and stakeholders.
In the side of the transaction deal, CK Hutchison will attain 50% of Ooredoo Asia’s shares through exchanging 21.8% of Indosat Ooredoo Hutchison’s shares with 33% of Ooredoo Asia’s stocks. Simultaneously, Tri Indonesia will obtain a 10.8% extra portion of Indosat Ooredoo Hutchison’s stocks.
Further, a total of US$387 million will be disbursed by CK Hutchison to acquire the additional Ooredoo Group ownership of 16.7%. After compiling this transaction, both two groups will hold 50% of Ooredoo Asia’s share respectively, clinching 65.6% of Ooredoo Hutchison’s stocks. The other portion of the Firm’s ownership will be hold by Indonesia’s government and public shareholders, namely by 9.6% and 14%. The Company also keeps using ISAT as their issuer code in Indonesia Stock Exchange (IDX).
“At the end of the transaction, Indosat Ooredoo Hutchison will be controlled by both Oooredoo Group and CK Hutchison,” Indosat management and Tri Indonesia.
The horizontal merger will always guide people to figure out the prospective Company’s leader. During the merger process, the Director and Chief Operating Officer of Indosat Ooredoo Vikram Sinha and Finance Head CK Hutchison Holdings Limited Nicky Lee will be nominated as Chief Executive officer (CEO) and Chief Financial officer (CFO) of Indosat Ooredoo Hutchison.
