KARACHI: Edotco Group — subsidiary of Axiata Group Berhad, listed on Bursa — on Monday announced its exit from the agreement to move forward with the acquisition of 13,000 towers from Pakistan Mobile Communications Limited (Jazz) in Pakistan after delays in necessary regulatory approval.
Dawood Hercules Corporation Ltd (DHCL) on Jan 19 announced that it was in the “process of injecting up to a cumulative amount of Rs17.45 billion ($940 million) in Edotco Pakistan (Pvt) in the form of equity and/or a short term loan”.
The share subscription agreement entered in for this purpose amongst DHCL, Edotco Investments (Labuan) Limited (Edotco Labuan) and Edotco Pakistan required various conditions that needed to be satisfied before consummating the transaction.
In a stock filing on Monday, DHCL said “it is no longer pursuing the transaction to invest up to Rs17.45bn in Edotco Pakistan.”
According to the DHCL notice, out of the prescribed conditions, certain material conditions have not been satisfied prior to the longstop date prescribed in the agreement. “We have exercised our right to terminate the agreement in accordance with the terms of the agreement and have so notified Edotco Labuan and Edotco Pakistan,” read the notice.
The transaction was terminated due to non-fulfillment of prescribed conditions mandated to be completed before the sale purchase agreement (SPA) within the stipulated time frame, in particular regulatory approval for the resulting change of control contemplated under the SPA.
Edotco remains committed to Pakistan and will continue to grow its existing business under Edotco Pakistan, says a press release. The company operates a regional portfolio of over 28,000 towers across core markets of Malaysia, Myanmar, Bangladesh, Cambodia, Sri Lanka and Pakistan with 17,000 towers directly operated by Edotco and a further 11,000 towers managed through a range of service providers.
In another notice issued on Monday, VEON Limited also confirmed the termination of sale with Tanzanite. The notice said that the parties have not received all the regulatory approvals required for the transaction and the extended long-stop date of Sep 14 has now passed.
Tanzanite — Pakistan based tower operating company — and Jazz signed an agreement for the sale in Aug 2017.
Published in Dawn, September 18th, 2018