Dialog, Axiata Group and Bharti Airtel Merge in Sri Lanka

By siliconindia  |  Thursday, 18 April 2024, 02:11:36 PM IST

Dialog, Axiata Group and Bharti Airtel Merge in Sri Lanka
In a significant move within the telecommunications sector, Dialog Axiata PLC (Dialog), Axiata Group Berhad (Axiata), and Bharti Airtel have inked a pivotal agreement to amalgamate their operations in Sri Lanka. This strategic maneuver is poised to reshape the telecom landscape in the island nation.
According to the agreement, Dialog will procure 100 percent of the issued shares in Airtel Lanka. In exchange, Bharti Airtel will receive ordinary voting shares, amounting to 10.355 percent of Dialog's total issued shares, through a share swap mechanism. However, the finalization of this transaction is contingent upon the approval of Dialog's shareholders and the fulfillment of specific conditions delineated in the Share Sale Agreement. This includes obtaining clearance from the Colombo Stock Exchange (CSE) and adhering to requisite legal, corporate, and regulatory compliance procedures.
The Telecommunications Regulatory Commission of Sri Lanka (TRCSL) has already given its nod of approval for this proposed merger, signifying a crucial milestone in the consolidation process.
This consolidation is poised to unlock a myriad of benefits for the merged entity, notably economies of scale, reduction of infrastructure duplication, synergies in technology and capital expenditure, and bolstered high-speed broadband connectivity. Furthermore, it is expected to result in an array of enhanced services, including voice and value-added services, while concurrently generating cost savings and operational efficiencies.
Gopal Vittal, the MD & CEO of Bharti Airtel Limited, expressed optimism regarding the merger, asserting that customers will continue to relish cutting-edge services seamlessly on the amalgamated network. Similarly, Vivek Sood, Group CEO and Managing Director of Axiata Group Berhad, emphasized that the merger aligns with Axiata's strategy of market consolidation and resilience. He underscored the value creation potential for shareholders of both Dialog Axiata PLC and Axiata Group, underscoring the anticipation of synergistic achievements.

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