Malaysia’s Axiata Group and India’s Bharti Airtel announced they will merge their operations in Bangladesh to create the country’s second largest player behind market leader Grameenphone.
The merger of Robi Axiata and Airtel Bangladesh will give the combined entity, Robi, a customer base of 39 million and a 28 per cent market share, pushing it past current number two Banglalink with a 24.5 per cent share.
Robi has 28.3 million connections and a 21 per cent market share, while Airtel has nearly 10 million connections and a 7.4 per cent market share, according to GSMA Intelligence. Airtel is the fourth largest among eight operators – the four smallest have a combined share of less than 5 per cent. Grameenphone has almost a 42 per cent share.
The merger is subject to receiving approvals from relevant authorities and is expected to be completed in the first half of the year.
Axiata will hold a 68.3 per cent controlling stake in the merged company, while Bharti will hold 25 per cent. The remaining 6.7 per cent will be held by Japan’s NTT Docomo, which is an existing shareholder.
The country has experienced high growth in mobile uptake, but with intense competition the merger is intended to strengthen the industry’s structure and competitiveness and bring benefits to customers in terms of network quality and coverage and improved data products and services, the operators said in a statement.
Robi CEO Supun Weerasinghe said the highly competitive and crowded Bangladesh telecoms sector “solicits consolidation and we believe this merger will form greater economies of scale for both groups”.
Gopal Vittal, Bharti Airtel’s managing director and CEO of India and South Asia, said the combined entity will be “well positioned to leverage the operational synergies to serve customers better”.