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XL Welcomes Approval for M&A with Axis

09:39:00 | 02 Dec 2013
XL Welcomes Approval for M&A with Axis
Hasnul Suhaimi (Dok)
Angkasa Pura 2
JAKARTA (IndoTelko)  – PT XL Axiata Tbk (XL) welcomes the Ministry of Communication and Informatics' (MoCI) approval to commence its Merger and Acquisition (M&A) with PT Axis Telekom Indonesia (Axis) – which was officially announced on November 29, 2013 in Letter No. 1147/M.KOMINFO/UM.01.01/11/2013.

MoCI's approval letter is proof that the government supports the consolidation efforts that will lead to a better and more sustainable industry.

President Director of XL Hasnul Suhaimi said, “We are delighted and thank the government for this strategic decision on the part of the regulator, who has given their blessing for our M&A plan with AXIS. This is a very important milestone in our consolidation journey and we believe we remain on track to finalize this process. The regulator's approval is a highly positive step in the continued development of our company’s business, the industry, and for consumers.”

XL remains committed to providing the best service to its customers – who will soon be able to enjoy the advantages of this consolidation. By acquiring Axis, XL will strengthen its position as one of the operators at the forefront of the industry. “We hope this M&A will improve service quality, increase access for our customers, and provide significant benefits to all stakeholders,” said Hasnul.

The regulator’s approval for this M&A plan will allow XL to overcome the resource constraints it currently faces as well as provide additional capacity to XL that will benefit all stakeholders.  

More than 65 million customers will experience better service quality and wider network coverage. This corporate action will support the development of the Indonesian telecommunication industry, while at the same time serving as a future reference for focused business growth and efficient capital expenditure. The mutually beneficial businesses of XL and Axis will also provide numerous revenue and cost synergies.

XL remains committed to supporting the government’s program in realizing the National Broadband Plan while also continuing to improve its own customer service quality and significantly maximizing its network for 2G and 3G.

From this merger plan, both XL and Axis customers will be able to enjoy better telecommunication services and a wider network reach. XL will also improve its asset utilization, especially for XL BTS towers and network equipment – with a significant reduction in both capital expenditure (CAPEX) and operational expenditure (OPEX).

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Comply
According to Hasnul, XL Axiata will comply with the decision given and existing rules & regulations, including the decision from MoCI in the case of XL being required to return the frequency spectrum

In its merger approval, MoCI has decided that 10 MHz of the 2100 MHz spectrum must be returned to the government. “We respect and will abide by the government’s decision which we believe is for the best interests of our industry. We are confident that this is the optimal decision for our business development and expansion. Although, referring to our previous letter, we expected to only return 5 MHz to the government.” said Hasnul.

Bakti
Hasnul also added that XL will retain all AXIS 15 MHz spectrum in 1,800 MHz which will be maximized to advance the telecommunication industry by working together with all stakeholders.
 
The government’s approval for the M&A plan is an important milestone towards XL completing the transaction. Moving forward, XL will conduct all the necessary steps to meet the regulatory requirements. This includes obtaining approval from the relevant regulatory bodies as well as XL shareholders through an Extraordinary Shareholders Meeting.(es)

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