The Axiata-Telenor merger, poised to be one of the more exciting mergers in Corporate Malaysia, is now hanging in the balance.
The Straits Herald spoke to two sources familiar with the matter and argues that this merger – while both parties are still at the negotiating table – is no longer viable to be pursued.
It boils down to political will.Straits Herald sources claims
Because of fears that jobs will be lost, the Malaysian unit of Axiata – Celcom – has seen some resistance from their staff. This, despite numerous effort by the Axiata management calming down fears of jobs being cut, post-merger.
Also on the table, is the rather nonchalant view that most ministers, particularly the ones that would have some locus standi on this matter, such as the Minister of Communications and the Minister of Economic Affairs seem to defer any opinions to the Prime Minister, Tun Dr. Mahathir Mohamad.
“The planned merger between Axiata Group Berhad and Norway’s Telenor Group’s Asian units, including that of DiGi in Malaysia may seem to work from the financials side, but not necessarily on the political will side,” claims a source when spoken under the condition of anonimity to the Straits Herald.
Last week, The Edge Financial Weekly reported that they have spoken to up to three sources who – more or less – argues the same notion as the sources of the Straits Herald.
Amongst the arguments cited in their report, are the minority shareholding Axiata would have, post-merger (43.5% to Telenor’s 56.5%), the perceived power of Telenor having a greater say in management because Telenor has the ability to appoint the CEO (this is where Axiata normally argues that power share is present due to Axiata having the ability to appoint the Chairman), and Celcom’s loss of jobs, as amongst the chief complaints on why the merger is a no-go, for now.
Note: The Straits Herald did not contact Axiata nor Telenor in producing this story.