By Business Desk in Petaling Jaya/The Star | Asia News Network
Petaling Jaya (The Star/ANN) - Telecommunication giant
Axiata Group Bhd is set to strengthen its foothold in Cambodia through a
merger between Hello Axiata Co Ltd and Latelz Co Ltd, which it acquires
for a consideration of US$155 million (473 million ringgit).
In a statement, Axiata announced that its Cambodian arm had entered
into a sales and purchase agreement to acquire shares of Latelz, owned
by Timeturns Holdings Ltd based in Cyprus.
Post merger, Axiata will hold a 90 per cent stake in the combined
entity and emerge as one of the largest operators in Cambodia in terms
of subscribers and revenue.
"Unique subscriber penetration in Cambodia is currently below 40 per
cent with an expected double-digit growth of around 10 per cent over the
next three years. As such, the headroom for growth is now and with this
merger, Axiata will have a head start with a significantly-strengthened
entity and clear market leadership," the company said.
It also said the consolidation would provide improved economies of
scale, remove duplicative costs and enhance revenue potential, amongst
other benefits.
"The merged entity will also facilitate synergies and the sharing of
best practices between the two companies. This will include increased
spectrum and significant synergies across network coverage and
infrastructure," the telco said.
The acquisition of Latelz will be financed by Axiata's
internal-generated funds and/or existing financing facilities and is not
expected to have any material effect on the gearings and net assets of
Axiata Group for the financial year ending Dec 31, 2012.
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