AGL 23.81 Decreased By ▼ -0.54 (-2.22%)
AIRLINK 103.60 Increased By ▲ 0.60 (0.58%)
BOP 5.66 Decreased By ▼ -0.05 (-0.88%)
CNERGY 3.93 Decreased By ▼ -0.03 (-0.76%)
DCL 8.36 Decreased By ▼ -0.14 (-1.65%)
DFML 41.70 Decreased By ▼ -1.29 (-3%)
DGKC 88.30 Decreased By ▼ -0.60 (-0.67%)
FCCL 22.70 No Change ▼ 0.00 (0%)
FFBL 40.88 Increased By ▲ 2.68 (7.02%)
FFL 8.96 Decreased By ▼ -0.15 (-1.65%)
HUBC 160.49 Decreased By ▼ -3.21 (-1.96%)
HUMNL 11.46 Decreased By ▼ -0.34 (-2.88%)
KEL 4.82 Decreased By ▼ -0.03 (-0.62%)
KOSM 4.09 Decreased By ▼ -0.04 (-0.97%)
MLCF 38.60 Increased By ▲ 0.19 (0.49%)
NBP 53.60 Increased By ▲ 0.75 (1.42%)
OGDC 130.60 Decreased By ▼ -2.29 (-1.72%)
PAEL 25.36 Decreased By ▼ -0.29 (-1.13%)
PIBTL 6.25 Decreased By ▼ -0.13 (-2.04%)
PPL 118.90 Decreased By ▼ -0.60 (-0.5%)
PRL 23.95 Decreased By ▼ -0.65 (-2.64%)
PTC 12.92 Increased By ▲ 0.28 (2.22%)
SEARL 59.11 Decreased By ▼ -0.49 (-0.82%)
TELE 7.43 Decreased By ▼ -0.06 (-0.8%)
TOMCL 34.99 Decreased By ▼ -0.16 (-0.46%)
TPLP 8.72 Decreased By ▼ -0.13 (-1.47%)
TREET 15.90 Increased By ▲ 0.10 (0.63%)
TRG 55.95 Decreased By ▼ -1.95 (-3.37%)
UNITY 34.95 Increased By ▲ 0.06 (0.17%)
WTL 1.20 Decreased By ▼ -0.02 (-1.64%)
BR100 8,536 Decreased By -8.5 (-0.1%)
BR30 27,187 Decreased By -204 (-0.74%)
KSE100 79,944 Decreased By -48.3 (-0.06%)
KSE30 25,500 Decreased By -43.9 (-0.17%)

Telenor Group, which is the parent of Telenor Pakistan, has reportedly agreed to merge its Thailand business with a leading Thai conglomerate. This doesn’t affect Pakistan as such. But a comment by the Telenor Group President to Reuters – that “Telenor will continue to look for merger opportunities in Asia, including in Pakistan and on a regional basis” – has encouraged merger talk here at home.

C-suite executives generally avoid talking in public about a merger, because they know that such talk, even if premature, can set alight markets and analysts. In this particular instance, there is perhaps not much to read, as the comment may have been presented out of context. Or it could be an attempt to project strength and put competitors on notice. Or, considering that Telenor Group has chosen to give up majority control in its Thailand business, it may be aiming to reduce its presence in Pakistan.

Whatever the case, merger talks have been revived.

BR Research’s background discussions with industry executives continue to give this impression that Pakistan’s low-revenue telecom market is more appropriate for a troika – a group of three players carrying the market – rather than four operators. The introduction of mobile broadband (3G and 4G) since 2014 has impacted operators’ growth and profitability differently. There is only a finite supply of well-paying data customers. And low investments in recent years have exposed quality of service.

Case for a merger exists because organic growth is hard to come by in the face of stiff competition for data customers. Besides, effective cost management in the context of rising utilities’ prices requires optimum scale and operational synergies. Despite sector-wide challenging circumstances, Jazz, the market leader, has been doing comparatively better than the rest, partly due to its strategic decision to acquire Warid back in 2015-16. Jazz has the firepower to attract more and more data customers.

The target of a potential merger could be the oft-mentioned Ufone, which is at the bottom of the mobile broadband subscription ladder. Future viability of mobile network operators depends on the mass of their data subscriptions. As of September 2021, PTA statistics show, Ufone had collected 10.5 million mobile broadband subscriptions, which constituted 10 percent of the 105 million pie. Back in CY20, Ufone recorded topline of Rs50 billion, as per data from latest PTCL Group annual report.

Should Telenor Pakistan merge with Ufone, the combined entity’s data subscription share will jump from 22 percent to 32 percent. This can assist Telenor Pakistan to not only overtake Zong at the second position (mobile broadband subscription share: 27%), but also come closer to Jazz (mobile broadband subscription share: 39%). If it is Zong that one day decided to acquire Ufone, Telenor Pakistan could be relegated to the last spot. That’s not the place it should want to be downgraded to.

But wait! Is Ufone even willing and available to be courted at this stage? After all, this operator has just acquired pricey new spectrum, with which it aims to turbo-charge its ability to attract and retain data customers. The new corporate strategy, under a new Group President and CEO, needs time to make good on the investment. Besides, there are reportedly some legal issues in selling Ufone (which is majority-owned by government) to a private operator. Let’s see how things shape up in the future.


Comments are closed.

Zia Nov 26, 2021 07:21pm
Telenor has been down sizing for years, the rumors were and remain that they will sell or merge with another, rather than buying & competing. Ufone on the other hand, recently bought more spectrum.
thumb_up Recommended (0)
Umair Mehmood Nov 26, 2021 10:27pm
First of all you should improve your network signal every single hour no service why
thumb_up Recommended (0)
Sarfraz Mahmood Nov 27, 2021 08:11pm
It is very surprising that GOP being holder of 62 % shares of PTCL & Secretary, MOITT being Chairman of its BOD is helpless in redressing the grievances of its pensioners whose services were transferred, as government servants, from erstwhile T&T Department to first PTC & later on to PTCL. Having GOP protected service, they are getting pensions as per Civil Servant Rules-1973. This position of the pensioners is confirmed by the Supreme Court in their judgment in Feb 1918, after 8 years long litigation by a group of 343 pensioners (petitioners). The root cause was usurping of GOP annual increments since July 2010 by PTCL management. Now those 343 pensioners, being petitioners, are receiving their pensions as per GOP Rules. The remaining forty thousand plus pensioners are languishing in High Courts for restoration of their lawful increase in pensions usurped by PTCL Management since July 2010. It is a pity that GOP, being majority share holder of PTCL, is not helping poor pensioners & has left the fate of pensioners at the mercy of PTCL’s foreign management (Etisalat of UAE). From where PTCL Pensioners will get relief at this time of pressing financial hardship. Now, only Allah SWT is left for helping the poor pensioners.
thumb_up Recommended (0)
Sarfraz Mahmood Nov 27, 2021 08:34pm
You have removed my earlier comments. Why ?
thumb_up Recommended (0)
Zafar goraya Nov 28, 2021 01:57am
thumb_up Recommended (0)