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Ooredoo, Hutchison ink $6b deal on Indosat-Tri merger
The deal to merge PT Indosat Ooredoo and PT Hutchison 3 Indonesia will enable the two firms to benefit from cost and capex synergies thanks to complementary infrastructure, an analyst said Friday.
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Loyalty is key: Indosat Ooredoo Greater Jakarta head Edi Riyanto (left), senior vice president (SVP) and head of retail and device management M. Andre Reinaldy (second left) as well as SVP and head of customer experience and service operation Philip Joseph talk with customers at the Indosat Ooredoo office in Jakarta in this undated photo. (JP/Dhoni Setiawan)
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wo telecom giants, Qatar-based Ooredoo and Hong Kong’s CK Hutchison, have inked a US$6 billion deal to merge their Indonesian businesses PT Indosat Ooredoo and PT Hutchison 3 Indonesia.
The new entity, PT Indosat Ooredoo Hutchison, would be the second-largest telecommunication company in Indonesia with almost $3 billion in annual revenue and could spend $300 million to $400 million in annual capital expenditure over the next three to five years, the companies announced on Thursday.
Vikram Sinha, chief operating officer at Indosat Ooredoo, was nominated the CEO of PT Indosat Ooredoo Hutchison, while Nicky Lee, finance head at CK Hutchison Holdings Limited, would serve as CFO of the new entity.
Indosat Ooredoo president director Ahmad Al-Neama and Hutchison 3 Indonesia president director Cliff Woo are to keep their positions until the merger is completed, and both are to join the board of commissioners of the new company.
“The merged company will be well placed to deliver a higher return on investment for all shareholders and build on the outstanding growth momentum already achieved by Indosat Ooredoo,” Aziz Aluthman Fakhroo, managing director of Ooredoo Group, said in a statement.
Read also: Indosat to ‘slowly shut down’ 3G network
The long-awaited merger comes after the government announced plans to push the country’s telecom firms into consolidation, with the limited frequency spectrum for wireless communication cited as one of the main reasons.
