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Logo of Phnom Penh Post newspaper Phnom Penh Post - Hello and Smart merge in US$155mn deal

Hello and Smart merge in US$155mn deal

Hello and Smart merge in US$155mn deal

Shop sell sim cat in kak pech
A seller shows Hello and Smart joint sim card in a phone shop at Koh Pich in Phnom Penh. Photograph: Vireak Mai/Phnom Penh Post

Malaysian-owned mobile phone company Hello Axiata Company yesterday announced a merger deal worth  about $155 million with Latelz Company Limited, which operates in Cambodia under the Smart Mobile brand.

The merger will create the second-largest mobile operator in the Kingdom after Metfone in terms of subscribers in Cambodia’s crowded mobile operator market.

Hello Axiata is a subsidiary of Axiata Group Berhad, one of Asia’s largest telecommunications companies.

Hello Axiata chief executive Simon Perkins told the Post yesterday the deal had been reached after a series of meetings between the companies.

“The deal has been agreed today, and we start on the integration project straight away,” Perkins said.

“The merger of the two companies makes a very significant business in Cambodia’s mobile industry.  When we put this together, it’s going to be five million subscribers. We will be number two in the market in Cambodia — and a very strong number two.”

Ek Vandy, secretary of state of the Ministry of Post and Telecommunications, said he welcomed any merger.

“It’s good for them if they want to become stronger in the market and want to compete with others.” Vandy said.

“Now, we’ve got around nine mobile operators, and I don’t want to see any of them go bankrupt. The merger is a good way for them because they can spend less.”

Ministry data shows the Kingdom has 15.7 million service subscriptions, exceeding the country’s population of 14.5 million.

Latelz chief executive Thomas Hundt could not be reached yesterday, but said in the press release the combined entity would be able to offer its five million customers more innovative, affordable mobile voice and data products and services.

“We are excited with the prospects this enlarged network community can offer our customers,” Hundt said.

“They will include an enhanced level of service and one of Cambodia’s  biggest mobile networks in terms of coverage and capacity.

“We expect the merger to be finalised, at the latest, by the end of first-quarter 2013.

“Until then, it will be business as usual at both Hello and Smart Mobile without disruptions to services.”

On completion, Axiata will hold a 90 per cent stake in the combined entity.

The Post reported recently that Thaicom, Mfone’s parent company, would sell its stake for $100 to INT Management Service.

Hello Axiata’s Perkins said he recognised the Cambodian mobile-phone market was tough, but the merger between Hello and Smart would make them stronger.  

“I don’t want to speculate on other operators, but you can see what’s happening very clearly,” he said.

“There are nine players in the market, and we believe that  through consolidations that will come down to between three and five.

“As for branding, that hasn’t been decided yet.”

To contact the reporter on this story: May Kunmakara at [email protected]

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