HC approves Robi-Airtel merger

The High Court yesterday approved much talked-about merger proposal of Robi and Airtel, paving the way for the formation of country's second largest mobile operator.
After the merger Robi will be the second largest operator after Grameenphone in terms of subscribers.
A single bench of the High Court comprised Justice Syed Refaat Ahmed came up with the approval during the hearing on a petition filed by Robi in this regard.
The HC also directed the concerned authorities to ensure voluntary retirement scheme for the employees who are not willing to work for Robi.
Bangladesh Telecommuni-cation Regulatory Com-mission’s lawyer Khandaker Reza-E-Raquib told reporters that the merged entity would have to pay Tk 100 crore as merger fees.
Apart from the merger fees, the merged entity will have to pay Tk 33.8 crore for each Megahertz of Airtel's 2G spectrums to be used by Robi for the next four years.
During the court hearing, Robi’s lawyer urged for installment facilities for this payment, but court forwarded the issue to Bangladesh Telecommunication Regulatory Commission (BTRC), said Raquib.
After expressing satisfaction over the HC approval, Robi’s Chief Corporate and People Officer (CCPO) Matiul Islam Nowshad said the approval follows the formal merger agreement signed in January 2016, between Axiata Group Bhd (Axiata) and Bharti Airtel of India (Bharti) to merge their respective operations in Bangladesh.
The proposed merger is expected to be completed by fourth quarter of 2016, he added.
In a written statement authorities concerned of Robi and Airtel said that they believe that the merger approval is certainly the right step towards ensuring a robust competitive landscape in the telecom sector of the country.
This approval strengthens our ability to contribute to the process of realising the government’s vision of Digital Bangladesh at a much greater scale. As a customer-centric Company, we are excited by the prospect of serving a larger subscriber base with vastly enhanced network capacity, it said.
Robi and Airtel opened talks on a possible merger at the end of August, 2015, and on January 28, the operators' parent companies signed a deal to that effect. If merged, the entity will be the second largest operator in Bangladesh.
In the merged entity, Axiata, the parent company of Robi, will hold 68.7 per cent controlling stake, Bharti Airtel 25 per cent and NTT DOCOMO of Japan 6.3 per cent.
Currently, Malaysia-based Axiata has 91.59 per cent stakes in Robi and Japan's DOCOMO 8.41 per cent, meaning both their shares in the Bangladeshi operation will be diluted after the merger.
On July 31, Prime Minister Sheikh Hasina approved the merger proposals keeping the merger fee, spectrum charge and other conditions unchanged.
On July 24, the Posts and Telecommunications Department (PTD) forwarded the summary of the merger proposal to the Prime Minister Sheikh Hasina for her consent, incorporating merger fee of Tk 100 crore.
Apart from the merger fees, he said, the PTD also fixed up Tk 33.8 crore for per Megahertz of 2G spectrum.
Earlier, on July 13, an inter-ministerial meeting, chaired by finance minister A M A Muhith, finalised the merger fees and spectrum prices.
The PTD in the proposal has incorporated several conditions for the merger of two mobile phone operators.
At present, Airtel is using 15 MHz of 2G spectrum and its license would be expired in 2020. If Robi acquires the entire spectrum, the operator has to deposit a total of Tk 507 crore to the telecom regulator.
According to the terms and conditions, "They (Robi) have to submit a specific plan on human resource management to the telecom regulator to ensure job security of employees so that no one is terminated or any unemployment is created centering the proposed merger."
Besides, a Voluntary Retirement Scheme (VRS) or Voluntary Separation Scheme (VSS) has to be prepared following the best practice of multinational companies, which has also to be submitted to the telecom regulator.
Moreover, the BTRC must be informed of making the full payment under the VRS/VSS within the 60 days of the completion of the merger. "If any complexity is created during implementation of the VRS/VSS, the merged company would adopt necessary measures through the directives of BTRC," according to the terms and conditions.
It was also included that in the next three-year of the merger, the regulator has to be informed with specific reason before any termination of the employees of Robi and Airtel joined the merged company.
In addition, jobs of employees of Airtel who would join the merged company would be considered as the continuation of the service in Airtel.

HC approves Robi-Airtel merger

The High Court yesterday approved much talked-about merger proposal of Robi and Airtel, paving the way for the formation of countrys second largest mobile operator. After the merger Robi will be the second largest operator after Grameenphone in terms of subscribers. A single bench of the High Court comprised Justice Syed Refaat Ahmed came up with the approval during the hearing on a petition filed by Robi in this regard. The HC also directed the concerned authorities to ensure voluntary retirement scheme for the employees who are not willing to work for Robi. Bangladesh Telecommuni-cation Regulatory Com-missions lawyer Khandaker Reza-E-Raquib told reporters that the merged entity would have to pay Tk 100 crore as merger fees. Apart from the merger fees, the merged entity will have to pay Tk 33.8 crore for each Megahertz of Airtels 2G spectrums to be used by Robi for the next four years. During the court hearing, Robis lawyer urged for installment facilities for this payment, but court forwarded the issue to Bangladesh Telecommunication Regulatory Commission (BTRC), said Raquib. After expressing satisfaction over the HC approval, Robis Chief Corporate and People Officer (CCPO) Matiul Islam Nowshad said the approval follows the formal merger agreement signed in January 2016, between Axiata Group Bhd (Axiata) and Bharti Airtel of India (Bharti) to merge their respective operations in Bangladesh. The proposed merger is expected to be completed by fourth quarter of 2016, he added. In a written statement authorities concerned of Robi and Airtel said that they believe that the merger approval is certainly the right step towards ensuring a robust competitive landscape in the telecom sector of the country. This approval strengthens our ability to contribute to the process of realising the governments vision of Digital Bangladesh at a much greater scale. As a customer-centric Company, we are excited by the prospect of serving a larger subscriber base with vastly enhanced network capacity, it said. Robi and Airtel opened talks on a possible merger at the end of August, 2015, and on January 28, the operators parent companies signed a deal to that effect. If merged, the entity will be the second largest operator in Bangladesh. In the merged entity, Axiata, the parent company of Robi, will hold 68.7 per cent controlling stake, Bharti Airtel 25 per cent and NTT DOCOMO of Japan 6.3 per cent. Currently, Malaysia-based Axiata has 91.59 per cent stakes in Robi and Japans DOCOMO 8.41 per cent, meaning both their shares in the Bangladeshi operation will be diluted after the merger. On July 31, Prime Minister Sheikh Hasina approved the merger proposals keeping the merger fee, spectrum charge and other conditions unchanged. On July 24, the Posts and Telecommunications Department (PTD) forwarded the summary of the merger proposal to the Prime Minister Sheikh Hasina for her consent, incorporating merger fee of Tk 100 crore. Apart from the merger fees, he said, the PTD also fixed up Tk 33.8 crore for per Megahertz of 2G spectrum. Earlier, on July 13, an inter-ministerial meeting, chaired by finance minister A M A Muhith, finalised the merger fees and spectrum prices. The PTD in the proposal has incorporated several conditions for the merger of two mobile phone operators. At present, Airtel is using 15 MHz of 2G spectrum and its license would be expired in 2020. If Robi acquires the entire spectrum, the operator has to deposit a total of Tk 507 crore to the telecom regulator. According to the terms and conditions, They (Robi) have to submit a specific plan on human resource management to the telecom regulator to ensure job security of employees so that no one is terminated or any unemployment is created centering the proposed merger. Besides, a Voluntary Retirement Scheme (VRS) or Voluntary Separation Scheme (VSS) has to be prepared following the best practice of multinational companies, which has also to be submitted to the telecom regulator. Moreover, the BTRC must be informed of making the full payment under the VRS/VSS within the 60 days of the completion of the merger. If any complexity is created during implementation of the VRS/VSS, the merged company would adopt necessary measures through the directives of BTRC, according to the terms and conditions. It was also included that in the next three-year of the merger, the regulator has to be informed with specific reason before any termination of the employees of Robi and Airtel joined the merged company. In addition, jobs of employees of Airtel who would join the merged company would be considered as the continuation of the service in Airtel.