Ooredoo Group and CK Hutchison seal Indonesia merger

After securing all shareholder and regulatory approvals, Qatar’s telecoms company Ooredoo and Hong Kong’s CK Hutchison Holdings Ltd completed the $6 billion merger of their Indonesian telecom businesses.  

The outcome of the deal is the new entity, Indosat Ooredoo Hutchison, the country’s second-biggest telecoms company after state-backed Telkomsel. The government has already given the principal merger approval in November.  

The new entity has the enhanced scale, financial strength, and capabilities needed to accelerate Indonesia’s economic growth and transformation into a digital society. The other result of the merger is the significant operational synergies that will deliver cost efficiencies and facilitate more profound innovation and network enhancements, including the rollout of 5G in Indonesia.   

Ooredoo Group and CK Hutchison will control Indosat Ooredoo Hutchison with a 65.6 percent shareholding. However, it will remain listed on the Indonesian Stock Exchange under the ticker ORDS, with the Government of Indonesia retaining a 9.6 percent shareholding, PT Tiga Telekomunikasi Indonesia holding a 10.8 percent shareholding, and other public shareholders owning approximately 14.0 percent.  

After the merger, Indosat aims to increase its tower sites by 11,400 by 2025 and expand its cellular services to cover a minimum of 7,660 more villages or districts by 2025, Indonesian communication minister Johny G. Plate said.  

On that same front, Vikram Sinha, the Chief Operating Officer (COO) of Indosat Ooredoo since 2019, will lead Indosat Ooredoo Hutchison as its new Chief Executive Officer (CEO). Nicky Lee has been appointed as Chief Financial Officer (CFO) of Indosat Ooredoo Hutchison. Ahmad Abdulaziz Al-Neama and Eyas Assaf have joined the Ooredoo Group.   

The merger idea has been circulating since 2020 and was introduced to shareholders in September 2021.  

It is worth mentioning that PT Indosat Ooredoo Hutchison is predicted by some reports to have an annual income of around $3 million, the pair famous, with the merger of the two companies designed to create operational synergies. According to both companies, this will cut back prices and simplify service and community upgrades alongside the rollout of 5G.  

Ooredoo Group managing director Aziz Aluthman Fakhroo stressed that the deal “created a stronger quantity of two participants in Indonesia, backed by two extremely dedicated companions.”