The shareholders of PT Indosat Tbk (Indosat Ooredoo) have approved the Indonesian operator's merger with rival Tri, which is also known as Hutchison 3 Indonesia.
Ooredoo announced the approval following an EGM at Indosat's headquarters, which also set the directors for the merged company.
"The Extraordinary General Meeting of Shareholders (EGMS) held on 28 December 2021 at Indosat Ooredoo’s head office has approved the merger of their respective telecommunications businesses in Indonesia, PT Indosat Tbk (Indosat Ooredoo) and PT Hutchison 3 Indonesia (H3I)," said a statement from the company.
Vikram Sinha will be Chief Executive Officer of the new entity, it added.
According to Jakarta Post, the boards of directors and commissioners will be effective after the date of incorporation and the fulfillment of all requirements is approved by the relevant authorities. Halim Alamsyah will serve as president commissioner, with Canning Fok Kin Ning and Aziz Ahmad M. Aluthman Fakhroo as two deputy president commissioners.
Earlier, Ooredoo Group and CK Hutchison closed a long-discussed deal to merge their Indonesian units with a transaction value of about $6 billion, creating the second-largest operator in the country with nearly 104 million subscribers.
The tie-up between Indosat Ooredoo and Hutchison 3 Indonesia (H3I) will be named PT Indosat Ooredoo Hutchison and remain listed on the Indonesian Stock Exchange. The companies stated they expect annual revenue of about $3 billion and are targeting cost reductions of $300 million to $400 million a year over three to five years.
After the completion of the merger, Indosat’s controllers will become Ooredo South East Asia and CK Hutchison Indonesia. The agreed merger exchange ratio is that Indosat’s current shareholders will own 67.40% of the surviving company and H3I shareholders will own 32.60% of the resulting company after the merger becomes effective.
According to market observers, the partnership will be beneficial for the two entities, as both are aiming for a bigger, stronger, and more competitive digital telecommunications and internet market.