Bharti and Axiata in talks to merge operations in Bangladesh

Bharti Airtel (BAL) and Malaysia's Axiata Group are in talks to merge their operations in Bangladesh to become the second largest telecom service provider in terms of subscribers. The companies have entered into an exclusive discussion to explore the possibility of combining the business operations of their telecommunication subsidiaries in Bangladesh Robi Axiata and Airtel Bangladesh.

Norway based Telenor run Grameenphone is the market leader with 53.8 million users, followed by Egypt’s Orascom owned Banglalink with 32.4 million. Airtel Bangladesh has a customer base of over 9 million and Robi Axiata has around 28 million. According to the company, BAL will be strategic minority partner in the proposed merger. The merger deal will also combine the strengths of both companies to create the second largest mobile operations in Bangladesh with over 37 million customers. 

BAL entered Bangladesh after acquiring 70 per cent stake in Warid Telecom of Bangladesh in 2010 and later picked up the remaining 30 per cent stake in 2013. The proposed merger with Axiata, BAL will lead to greater industry stability, translate into affordable & innovative products and services for customers through continued investments.It is a good move for BAL as the merger can get a lot more subscribers in a market where they have been struggling to compete. The company will also get a lot more geographical coverage through the deal. Robi has about 25 per cent market share and BAL has 7 per cent market share in Bangladesh.

On the Financial front, Robi's gross revenue stood at Rs 4006 crore and BAL's Bangladesh segment revenue stood at Rs 1470 crore as of FY14. The share price of BAL on BSE declined by 2.14 per cent and is trading at 350.1 on intraday basis.

Bangladesh's Robi Axiata is the most dynamic and rapidly growing telecommunications operator in Bangladesh. The company is developing its services to meet increasing customer needs ranging from voice and high speed internet services to tailormade telecommunications solutions.

BAL is the third largest mobile operator in the world with operations in 20 countries across Asia and Africa. The company's product offerings in India include 2G, 3G and 4G wireless services, mobile commerce, fixed line services, high-speed digital subscriber line (DSL) broadband, Internet Protocol Television (IPTV), DTH and enterprise services, including national and international long-distance services to carriers. It has over 1.85 billion customers all over the globe. BAL has a mix of 1800 Mhz and 2300 Mhz bands and holds 4G airwaves in 15 circles.