Telenor eyes a tie-up to make greatest Thai service


Wedding ceremony bells could quickly be peeling out for Norway’s Telenor and Thailand’s Charoen Pokphand Group.

And in the event that they do, the ensuing telco may nab 52% of the market within the nation of 70 million.

Sigve Brekke’s Telenor, which has been concerned in Thailand for 20 years, is father or mother to the nation’s second largest operator, Dtac, and Charoen Pokphand owns third-place True.

Prospects look forward to service on the Dtac store at its workplace constructing in central Bangkok, Thailand.
(Supply: REUTERS / Alamy Inventory Photograph)

Dtac was hit by the pandemic and had weak current outcomes, so may do properly from the tie-up. The telco’s valuation is at present round $3 billion, whereas True’s is half once more greater at $4.5 billion.

However regulators clearly would want to smile on the deal, particularly since it could depart Thailand primarily with two huge cell operators.

Thai up

Telenor has been casting round for extra tie-ups in quick rising southeast Asia, to make up for writing off operations price $782 million in post-coup Myanmar in Could.

In June, it minimize a $15 billion deal to merge its Malaysian cell enterprise with Axiata Group’s, forming the nation’s greatest cell operator in its greatest telecoms transaction ever. Roughly half Telenor’s income comes from Asia, with the opposite half in its Nordic neighborhood residence.

However “there are open points excellent and there’s no certainty that the discussions will end in a remaining settlement,” the Oslo operator cautioned.

And it “is not going to present any additional feedback at this stage of the method.”

Thailand’s financial system, with a excessive reliance on tourism, has been slower to get well from the consequences of COVID-19 than different Asia Pacific rising markets. 40 million vacationers a yr visited earlier than the pandemic, bringing their cellphones with them.

Income in Thailand’s cell sector declined 2.9% in 2020, and is principally flat this yr, says scores company Fitch. And extra broadly, after Thailand’s 6.1% GDP contraction in 2020, the financial system will develop simply 2.9% in 2021, it predicts.

Telenor within the cloud, with Google

The Thai deal copies the Malaysian one: smashing collectively the second- and third-place operator to create a brand new primary.

The merged Malaysian entity, Celcom Digi Bhd, could have a mixed subscriber base of round 19 million, in a rustic that has 32 million folks.

Two years in the past, Axiata and Telenor had been on the verge of merging their Asian operations solely, creating a gaggle with 300 million clients. However they deserted that deal after it got here beneath harsh criticism from Mahathir Mohamad, Malaysias prime minister.

In the meantime, Telenor has been rolling again its remaining stakes in central and jap Europe, after a 2015 scandal which noticed Norway’s authorities demand the resignation of Telenor chairman Svein Aaser.

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It is also the second huge deal for Telenor in every week, which additionally noticed it pair up with Google Cloud.

The service supplier can also be canvassing for consumers for its 55% stake in Pakistan’s Telenor Microfinance Financial institution, the place China’s Ant Group holds the rest after a 2018 deal. Pakistan’s MCB Financial institution is operating a rule over the cell financial institution unit, and pondering a suggestion.

In current months, it is Telenor’s Nordic operations that shined, with subscription and visitors income up 4% in Finland and Norway.

However within the longer run, Telenor is betting on southeast Asia to be its engine of progress, the place, if accepted, this Thai-up may find yourself the jewel in its empire.

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Pdraig Belton, contributing editor particular to Mild Studying


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