True Corp and dtac outlined the process for moving ahead with a proposed merger, with the companies to hold a joint shareholders’ meeting on 4 April to propose and determine the name of the new entity after securing approval of the tie-up from each company’s investors the same day.
In a joint statement, the Thai operators noted the deal is expected to be completed by September. Following the shareholder vote, each company needs to notify its creditors, which have two months to object to the deal.
The timeframe assumes all regulatory approvals will be secured.
Kiatnakin Phatra Securities, an independent financial adviser appointed by True, forecast in a report for shareholders mobile ARPU will grow 5 per cent annually after the full launch of 5G service in 2022, but expects the growth to slow to 1 per cent after 2023, with no new mobile service on the horizon.
The operators suggested a merger is likely to increase the quality of telecoms infrastructure and services in the country, given their combined spectrum holdings. They argued the new company will benefit from improved efficiencies in operating and capital costs when deploying 5G, allowing it to spread the high fixed investment over a larger customer base and be in a position to roll out the network more quickly.
Last month, the boards of both companies approved the deal and filed a merger notification with the regulator. A subcommittee was appointed in early March and as until May to examine the deal and make any recommendations.
The combination of the two companies will give the new entity a market share of about 53 per cent based on the operators’ mobile connections at end-2021, ahead of current market leader AIS with a 46 per cent share.
True’s parent company Charoen Pokphand Group will take a near 29 per cent stake, dtac will hold a 19.6 per cent interest and China Mobile a 10.4 per cent share.
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