Indonesian telco Smartfren has confirmed it is in talks with local peer Bakrie Telecom about a potential merger.
It also told the country’s stock exchange yesterday that a binding agreement had not been reached with Bakrie Telecom, which was reported…
Indonesian telco Smartfren has confirmed it is in talks with local peer Bakrie Telecom about a potential merger.
It also told the country’s stock exchange yesterday that a binding agreement had not been reached with Bakrie Telecom, which was reported earlier this week to have been sued by investors after allegedly missing two interest payments on a US$380m bond.
Local publication Investor Daily had earlier cited Bakrie Telecom’s COO, Imanuddin Kencana Putra, as saying it was considering a merger with Smartfren, one of the smallest players in Indonesia’s crowded mobile market.
The two networks share the same CDMA technology, which Fitch said in May was falling out of favour in the country. The ratings agency also said Smartfren had been struggling to gain market share and may also face liquidity problems.
The bondholders suing Bakrie Telecom reportedly claim it does not plan to make interest payments on the notes while it looks to restructure its debt.
FTI Consulting is reportedly advising Bakrie Telecom on the restructuring.
Indonesia’s mobile sector has already seen a consolidation deal this year with XL Axiata, which is majority-owned by Malaysian giant Axiata, wrapping up its US$865m Axis acquisition in March.
