Telecom operator Airtel is in talks with Robi Axiata to merge their business operations in Bangladesh, the company said in a notification with the Bombay Stock Exchange. The development follows reports that Airtel is looking to sell its towers in Sri Lanka and Bangladesh.
According to the Bangladesh Telecommunication Regulatory Commision’s July data, Robi Axiata is the third largest telecom operator with 27.921 million subscribers and Airtel is the fourth largest telco with 9.080 subscribers in the country. The combined entities will have 37.001 subscribers and will overtake Banglalink Digital Communications as the second largest telecom company in Bangladesh. A report by DNA says that Airtel will remain in Bangladesh as a strategic minority partner following the merger.
Airtel entered Bangladesh by acquiring 70% stake in Warid Telecom in 2010, while in 2013, it picked up the remaining 30% too.
Note that Robi’s parent group, Malayasia-based Axiata Group Berhad, also owns 19.79% stake in Idea Cellular.
Airtel’s Bangladesh operations and financials
At the end of the June quarter, Airtel was present in 64 district with a distribution network comprising of 152,000 retailers across Bangladesh. The company also has more than 2,000 3G sites in the country.
Note that Airtel reports its Bangladesh and Sri Lanka operations under South Asia head, and revenue from the region stood at Rs 388.6 crore for the first quarter of FY 2015, a decrease of 11.1% as compared to Rs 437.1 crore in the corresponding quarter last year. Data revenue grew by 66.3% to Rs 55.3 crore as compared to Rs 33.2 crore in the corresponding quarter last year.
Data customers represented 27.0% of the total South Asia customer base in the quarter as compared to 19.7% in the corresponding quarter last year. Total data consumption during the quarter increased by 90.2% to 3.99 billion MBs as compared to 2.10 billion MBs in the corresponding quarter last year. Data usage per customer also increased to 560 MBs, a growth of 25.0% as compared to 448 MBs in the corresponding quarter last year.
Robi Axiata’s Bangladesh operations and financials
For the quarter ended June 30, Robi Axiata reported revenues of 12,952 million BDT (Bangladesh Taka), an increase of 5.58% from the corresponding quarter last year. Data contributed 9% of the total revenue. Robi Axiata reported a profit after tax of 939 million BDT, a fall of 17.41% from the same quarter last year.
Other Airtel deals in Bangladesh
In November 2013, Mobile value added services company Mahindra Comviva inked a three year managed VAS deal with Bharti Airtel’s Bangladesh subsidiary. As part of the deal, Airtel would be outsourcing the management of its service delivery platform in Bangladesh to Mahindra Comviva, which includes Comviva’s deployed products like Messaging Service Delivery Platform (MSDP), Unstructured Supplementary Service Data (USSD), Bulk Messaging Gateway (BMG) and dBILL VAS Charging solution.
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