Celcom-Digi merger as Malaysia’s

largest telco is almost complete after

approval from shareholders
 BY Alexander Wong
 18 November 2022
 7:02 pm
 Comment

The Celcom and Digi merger is in its final stages after obtaining approval from their
shareholders. The board of directors of Axiata Group Berhad and Digi Telecommunications
made their announcements after their Extraordinary General Meeting (EGM) today.
According to Axiata’s statement, the outcome of the EGM by poll vote has been submitted to
Bursa Securities (Bursa) as required by the applicable regulations. It added that the merger
moves closer to completion, having previously cleared the Malaysian Communications and
Multimedia Commission (MCMC), the Securities Commission and Bursa prior to this EGM.
Meanwhile, Digi said the approval by both Digi’s and Axiata Group Berhad’s shareholders is
one of the final steps in the proposed merger approval process, having previously been
cleared by the MCMC, the Securities Commission and Bursa Malaysia. Once the merger is
completed, Axiata and Telenor will hold equal ownership of 33.1% each in the newly merged
company which is proposed to be named Celcom Digi Berhad.

The current attempt to merge Celcom and Digi was announced in April last year and it would
form the largest telco in Malaysia when the merger process is targetted to be completed by
end of 2022. Besides Telenor and Axiata, other Malaysian institutional funds such as EPF,
PNB, KWAP and the public will own the remaining 33.8% stake in Celcom Digi Berhad.
To address anti-competitive concerns, Celcom and Digi have agreed to several undertakings
outlined by the MCMC. This includes returning a total of 70MHz of spectrum over a 3-year
period, divesting Yoodo and to establish an independent business unit to manage Mobile
Virtual Network Operators (MVNO) to ensure clear separation from Celcom Digi Berhad’s
retail mobile business. On top of that, Celcom and Digi must also remove exclusive
distributor arrangements in several states and to position both products under a single
corporate brand.
Celcom and Digi are among the four telcos that have signed the Share Subscription
Agreement to take an equity stake in Digital Nasional Berhad. Because of the impending
merger, both telcos are only allowed to take a stake of 12.5% each as the merged entity
would not be allowed to hold more than 25% share holding in the 5G single wholesale
network.
Both Celcom and Digi currently offer 5G services to consumers via the 5G national network
after signing a 10-year 5G access agreement.