Astro, Telekom Malaysia merger speculation


PETALING JAYA: Could a mega merger be in the works in the country?

That is the speculation touched on by a report in The Edge Weekly today.

According to the financial publication, speculation is rife that Khazanah Nasional, which owns 20.7 per cent of Astro Malaysia Holdings Bhd and 28.7 per cent of Telekom Malaysia, may be proposing a merger between the two major corporations.

Further to this speculation are talks that Telekom Malaysia (TM) and Axiata may get back together again following the acquisition of a majority stake in P1 Wimax by TM in September 2014. TM has since boosted its ownership of P1, which has been rebranded as webe, from the original 55 per cent to 73 per cent as of early this year.

With Khazanah Nasional having a large stake in both TM (28.7 per cent) and Axiata (37.8 per cent), the merger is thought to be a way to deal with the competition between Axiata’s Celcom and TM’s webe.

Some analysts have also gone so far as to speculate that TM’s mobile arm could be carved out for Axiata and the rest merged with Astro, Edge Weekly reported.

“Ananda Krishnan and his associates control 40.98% of Astro.

“Much depends on what the shareholder (Khazanah or Ananda) wants to achieve,” one seasoned regional telecoms analyst told Edge Weekly, adding: “If the shareholder really wanted to do the deal, there will be merits.”

Meanwhile, any possible merger between TM and Axiata will be seen as a boost for the biggest fixed line and broadband provider in the country.

TM first acquired Celcom in 2003 to merge with its own mobile arm, TM Cellular, and formed the largest mobile telecommunications firm in the country.

Axiata (formerly TM International) was originally a holding company for the international interests of TM, but the group was demerged in 2007.

The move was criticised by many quarters, as Axiata was considered a “sunrise” business with growing interests overseas which had large potential for greater revenue and profits to TM.