CP Group and Telenor to merge Thai units

22 November 2021 | Saf Malik

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Charoen Pokphand Group (CP Group) has agreed to merge its Thai telecom units with the Norwegian telco Telenor in a deal worth around $8.6 billion.

Telenor will merge its Total Access Communication (Dtac) with CP Group’s True Corporation (TRUE.BK) and the partnership will allow for deeper 5G investment opportunities.

The deal is subject to regulatory approvals and is likely to give ownership of a third of the merged entity to Telenor and CP Group. Until the completion of the transaction, the businesses will continue to be run independently.

Suphachai Chearavanont, CEO of CP Group said, “The telecom and technology sectors are key to enabling Thailand to move up the development curve and to create broad-based prosperity.

“Today is a step forward in that direction. We hope to empower a whole new generation to fulfil their potential to become digital entrepreneurs leveraging an advanced telecom infrastructure.

“The emergence in Thailand of IoT, AI, Cloud and new generations of mobile network technologies will have a huge effect on the way we do everything,” he said.

The newly merged company will have a revenue market share in the low 40% according to the companies and will be listed on the Thai stock exchange.

The companies add that it faces a challenging operational environment and has proposed a cash alternative at an ‘attractive’ premium for all shareholders of dtac and True.

Jørgen A. Rostrup, executive vice president of Telenor Group and head of Telenor Asia said: “The proposed transaction will advance our strategy to strengthen our presence in Asia, create value, and support long-term market development in the region.

He added that the company has the intention of raising venture capital funding together with partners to invest in promising digital startups focusing on new products and services for the benefit of all Thai consumers.

“We have a long-standing commitment to both Thailand and the Asian region, and this collaboration will strengthen it further. Our access to new technologies as well as the best human capital will be a vital contribution to the new company.”