Axiata's Indonesian subsidiary, XL Axiata, has received final regulatory approval to acquire rival Axis Telekom, and lined up a $500 million loan from its parent for the purchase.
Indonesian antitrust authority KPPU has finally signed off on the merger, the last regulatory approval required after the Ministry of Communications and Informatics cleared the acquisition in December. XL Axiata shareholders voted to approve the merger last month.
In a statement, XL Axiata said it has now fulfilled all the regulatory requirements in its conditional agreement with Axis.
The KPPU took the view that the merger will not trigger a monopoly, as the post-merger company will have around 21% market share, far below the share of incumbents such as Telekom Indonesia.
XL has also agreed to stay in contact with KPPU throughout the merger process to ensure compliance with the relevant rules and regulations.
XL has meanwhile announced it has secured a $500 million loan from its parent to help fund the acquisition. The loan has a 2.41% interest rate for the next three years, the Jakarta Globereported. Axiata Group has a 66.5% stake in XL Axiata.
XL Axiata signed a conditional agreement with Saudi Telecom Company in September covering the purchase of 95% of Axis. The remaining 5% will be held by an Indonesian shareholder, as per the nation's foreign investment rules.