BusinessFriday 17 September 2021

QSE FTSE 100 DOW BRENT7,036.11 +19.62 (0.28%) 34,634.88 −179.51 (0.52%) $74.86 (-0.93) 11,180.92 +69.80 (0.63%)

Attractive Offers on Freezer & Passenger Vans In House Finance Available

Call 50123823 for Best Deals Location: Salwa Road Showroom

ECB to scrutinise banks’ trading books to expose climate riskNo bank has what the ECB wants. Global banks face the added challenge of finding data from regions outside Europe, which is limited.

Business | 10Fernando de la Mora Alvarez & Marsal Managing Director

09

EU international trade increases in JulyAnAdolu — ISTANBUL

The EU’s exports and imports both increased on a yearly basis in July, by 10.3 percent and 18.7 percent respectively, official figures showed yesterday.

The 27-member bloc’s exports totaled €186.1bn ($219.6bn), while imports amounted to €170.4bn, the statistical authority Eurostat said. The average euro/US dollar exchange rate was 1.18 in the month. The union’s trade balance posted a surplus of €15.7bn, down from €25.1bn in

the same month last year. Intra-EU trade also soared 15.8 percent to stand at €277.7bn year on year in July.

During the first seven months of this year, the EU’s exports increased 13.2 percent to reach €1.23 trillion, while imports were up 14.7 percent to reach €1.13 trillion.

China was the bloc’s main trade partner in the January-July period, with €130.7bn imports from the union and €246.5bn in exports. Country-to-country trade balances indicated that the EU had incurred the largest deficit with China – €115.8bn – and the highest

surplus with the US – €98.2bn – over the same period. Turkey was the union’s sixth-largest trade partner during the four-month period, with €43.6bn imports from the union and €45bn in exports. On the eurozone side, extra-EA exports increased 11.4 percent to €206bn in July. The trade surplus was €20.7bn, down from €26.8bn in July 2020.

The eurozone/euro area or the EA19 represents the member states that use the euro as their single currency, while the EU27 includes all member countries of the bloc.

Turkey’s clean energy investments reach $66bnAnAdolu — ANKARA

Turkey’s clean energy invest-ments have reached $66bn (TL 559bn), with renewables consti-tuting over 53 percent of the country’s total installed power capacity, data showed yesterday.

Installed renewable capacity amounted to 52,353 megawatts (MW) out of a total capacity of 98,493 MW as at the end of last month, the data compiled from Electricity Transmission Company (TEIAŞ) showed.

According to the Renewable Energy Investors Association (GÜYAD), the investment value per MW is dependent on the source, area where it is gen-erated, the technology used, global costs and incentives.

Taking these parameters into consideration, hydropower investments reached $35bn with 31,441 MW of installed capacity. Yet, hydropower output has seen a dramatic drop due to severe droughts that have been drying up rivers and reservoirs.

Investments in the wind sector, the second-largest clean energy producer in the country at 10,014 MW, have been calcu-lated to have reached around $13bn.

Energy and Natural Resources Ministry last week announced that wind power capacity exceeded the 10,000 MW threshold in August when the country ranked as one of the 10 top countries worldwide with the highest wind power, and the fifth in Europe with over 10,000 MW. Solar power generated about $10bn in investment with 7,435 MW of installed capacity.

Turkey’s geothermal capacity reached 1,650 MW with

an investment of about $6bn, while the investment volume for 1,813 MW in biomass power plants stood at $2bn.

By the end of August, hydro-power accounted for 32 percent of the total installed electricity capacity, wind contributed 10.2 percent, solar comprised 7.5 percent, and geothermal and biomass constituted 1.7 percent and 1.8 percent, respectively.

The share of renewables in electricity generation during the January-August period of this year remained relatively low at 37.7 percent due to drought in the country. Natural gas replaced lower output from hydropower plants during this period.

Renewables generated around 83.5 billion kilowatt-hours (kWh) of electricity out of 221.6 billion (kWh) of total output during the January-August period.

Turkey added a total of 2,602 MW of renewable capacity this year, accounting for almost all of the growth.

Wind led the additional capacity during the January-August period with 1,182 MW, followed by 768 MW of solar, 457 MW of hydropower, 328 MW of biomass and 37 MW of geo-thermal capacity.

Ooredoo Group, CK Hutchison agree $6bn Indonesian mergerTHE PEnInSulA — DOHA

Ooredoo Q.P.S.C. (Ooredoo) and CK Hutchison Holdings Limited (CK Hutchison) yesterday announced the signing of definitive transaction agree-ments for the proposed merger of their respective telecommunications busi-nesses in Indonesia, PT Indosat Tbk (Indosat Ooredoo) and PT Hutchison 3 Indonesia (H3I). The merged company will be named PT Indosat Ooredoo Hutchison Tbk (Indosat Ooredoo Hutchison).

The merger of Indosat Ooredoo and H3I will bring together two highly com-plementary businesses to create a larger, commercially stronger and more competitive world-class digital telecoms and internet company, well placed to deliver more value for all shareholders, customers and for Indonesia.

Indosat Ooredoo Hutchison will be well positioned to accelerate Indonesia’s economic growth and transformation into a digital society. It will be the second largest mobile telecoms company in the country, with an estimated annual revenue of approximately $3bn. The combined company will have the scale, financial strength, and expertise to compete more effectively. Combining the highly complementary assets and products of Indosat Ooredoo and H3I will drive innovation and network improvements that will enable the delivery of outstanding digital services, as well as a broader product offering, to customers across Indonesia.

Indosat Ooredoo and H3I own highly complementary infrastructure and the combination of these assets will also enable the merged company to benefit from cost and CAPEX synergies and provide accretive returns to all

stakeholders. Annual run rate pre-tax synergies of approximately $300m-$400m are expected to be realized over 3-5 years.

In addition, Indosat Ooredoo Hutchison will be able to leverage the experience and expertise of Ooredoo Group and CK Hutchison in networks, technologies, products and services, and benefit from their multinational oper-ations spanning major markets in Europe, the Middle East, North Africa, and Asia Pacific. The merged company

will also benefit from their combined strength and economies of scale in func-tions such as procurement.

Following the merger, the Indo-nesian mobile market is expected to retain a healthy level of competition, attractive to long-term investment across the industry.

Ooredoo Group currently has a con-trolling 65.0 percent shareholding in Indosat Ooredoo through Ooredoo Asia, a wholly-owned holding company. The merger of Indosat and H3I will result in

CK Hutchison receiving newly issued shares in Indosat Ooredoo amounting to 21.8 percent and PT Tiga Telekomu-nikasi Indonesia amounting to 10.8 percent of the merged Indosat Ooredoo Hutchison business.

Concurrent with the merger, CK Hutchison will acquire a 50 percent shareholding in Ooredoo Asia by exchanging its 21.8 percent share-holdings in Indosat Ooredoo Hutchison for a 33.3 percent stake in Ooredoo Asia, and will acquire an additional 16.7 percent stake from Ooredoo Group for a cash consideration of $387m. Fol-lowing the above transactions, the Parties will each own 50.0 percent of Ooredoo Asia, to be renamed Ooredoo Hutchison Asia, which will retain a con-trolling 65.6% ownership stake in the merged company.

Upon closing of the transactions, Indosat Ooredoo Hutchison will be jointly controlled by Ooredoo Group and CK Hutchison. It will remain listed on the Indonesian Stock Exchange, with the Government of Indonesia retaining a

9.6 percent shareholding, PT Tiga Tel-ekomunikasi Indonesia holding a 10.8 percent shareholding, and other public shareholders holding approximately 14.0 percent.

Subject to necessary Indosat Ooredoo shareholder approvals, the Parties have agreed to nominate Vikram Sinha as CEO and Nicky Lee as CFO of Indosat Ooredoo Hutchison. Ahmad Al-Neama will remain President Director and CEO of Indosat Ooredoo and Cliff Woo will remain as CEO of H3I until completion of the merger. Upon com-pletion, Ahmad Al-Neama and Cliff Woo will join the Board of Commissioners of the merged company, subject to the nec-essary Indosat Ooredoo approvals.

The Parties are committed to prior-itizing employee welfare during the inte-gration process in adherence with appli-cable laws and aligned with future business growth opportunities. The combined company is expected to create exciting growth opportunities for employees, as part of a larger, financially stronger, more competitive and inno-vative technology company.

Aziz Aluthman Fakhroo, Managing Director of Ooredoo Group, said: “This agreement is a significant step towards our shared vision of creating outstanding value for our customers and share-holders by bringing together two of Indonesia’s leading telecoms brands to create a stronger number two player in Indonesia, backed by two highly com-mitted partners in Ooredoo Group and CK Hutchison. With this agreement in place, we can now turn our attention to closing the transaction and then working closely with CK Hutchison to leverage the combined expertise of our respective global telecoms groups to build a world-class digital telco for Indonesia. P10

GECF shines spotlight on Angola’s potentialTHE PEnInSulA — DOHA

The Gas Exporting Countries Forum (GECF), the global platform of the leading gas producing countries, participated in the 2nd edition of the Angola Oil and Gas Conference, highlighting the immense energy potential of Angola to a global audience.

The two-day event fostered intense debates, networking opportunities and paved the way for a strong energy sector in a post-pandemic era by exposing potential investors to energy-related projects in Angola and other African markets. The con-ference addressed recent gov-ernment reforms, tax incentive packages, and gas initiatives to accelerate Angola’s energy tran-sition ambition.

Addressing the delegates, GECF Secretary General, Yury Sentyurin, lauded the government in Luanda on liberalising the energy sector and working to unlock the nation’s human potential.

“The government has been working to improve the investment environment by amending legal and fiscal terms.

The creation of a single-contact mechanism for investors to obtain necessary authorisations in a sim-plified manner, is a progressive step and I would like to commend H E Diamantino Pedro Azevedo, Minister of Mineral Resources, Petroleum and Gas, for taking bold steps. Angola, of course, has also adopted a law allowing the creation of free trade zones with incentives and benefits,” said Sen-tyurin. Minister Azevedo is also shouldering the responsibilities of the OPEC Conference President throughout 2021.

In 2020, the Angolan gov-ernment approved new legislation focused on maximising the

benefits of the oil and gas industry value chain to promote local content. Angola, which together with other African countries forms one third of the GECF’s 18-member consortium, is Sub-Saharan Africa’s third largest economy and one of Africa’s richest states in terms of natural resources.

“There is a huge potential for intra-regional LNG and pipeline gas trade in the continent. Joint investment and cross-border infrastructure in the natural gas and energy industry in Africa could play a major role in achieving energy independence in the continent.”

According to Sentyurin,

natural gas, as a reliable and affordable energy source could play a crucial role in bridging the gap between net zero targets and economic recovery.

“Particularly, the GECF Member Countries continue to be reliable suppliers of gas and LNG, demonstrating their readiness to prioritise environmental obliga-tions. Furthermore, at the level of the Forum, there have been several initiatives illustrating our commitment towards energy transition, such as the recently-launched GECF Environmental Knowledge and Solutions framework, environmental lead-ership through the GECF- UNESCO MoU, and the Forum’s direct participation in COPs (COP 24 and COP25) and the contri-bution to G20 Energy Ministe-rials,” explained HE Sentyurin.

Furthermore, the GECF Gas Research Institute (GRI) located in Algeria, one of the leading African countries in natural gas industry, signals the arrival of GECF’s technological and research arm that will champion the effi-ciency of natural gas for GECF’s Member Countries and the industry at large, he noted.

Landmark telecoms transaction in Asia with a total transaction value of approximately $6bn.

The transaction will consolidate the merged company as a stronger second operator in Indonesia with annual revenue of approximately $3bn. Managing director of ooredoo Group Aziz Aluthman Fakhroo (left) and Group

Co-Managing director of CK Hutchison Holdings limited Canning Fok

Installed renewable capacity amounted to 52,353 megawatts (MW) out of a total capacity of 98,493 MW as at the end of last month, the data compiled from Electricity Transmission Company showed.

GECF Secretary General Yury Sentyurin speaking during the 2nd edition of the Angola oil and Gas Conference.

10 Friday 17 September 2021BUSiNESS

ECB to scrutinise banks’ trading books to expose climate riskBloomBerg

The European Central Bank will look at the trading operations of major lenders as part of climate stress tests next year, after judging that an assessment of loan books alone won’t give enough insight into the fallout they face from global warming.

The ECB, which has yet to publicly disclose the parameters of its tests, will also study the reputational and operational risks banks face, Alvarez & Marsal, a consultancy firm that’s involved in the process, told Bloomberg.

Reaching into banks’ trading operations represents an addi-tional challenge for an industry that’s already warned it’s not ready for next year’s landmark tests. The ECB is seeking more details than other central banks and, behind the scenes, has stepped up pressure on the industry to meet the moment.

In Europe, politicians want banks to become a key plank in the fight against climate change by steering capital away from polluters. Investors are taking note as banks burdened by carbon-intensive balance sheets may face higher capital require-ments, which could erode their power to pay dividends.

“No bank has what the ECB wants,” said Fernando de la Mora (pictured), a managing director at Alvarez & Marsal who’s advising banks on how to prepare for the stress tests. “Global banks face the added challenge of finding data from regions outside Europe, which is limited.”An ECB spokesman declined to comment.

The ECB is also asking banks for data on emissions associated with the revenue they generate, an approach the Bank of England opted against for its climate tests this year because of a lack of available data, according to Alvarez & Marsal.

In practice, euro-zone banks will have to estimate the carbon emissions of companies behind most of their fee and interest income. They’ll also need to provide data on the emissions, loans and revenue associated with their biggest clients across industries, the firm’s analysis shows.

The decision to include banks’ trading books adds a further layer of complexity to the exercise. But it will also allow the ECB to see what might happen to stock or bond portfolios if they’re exposed to shocks such as losses on the debt of oil companies, de la Mora said.

Both the ECB and the BoE are asking lenders to use a 30-year horizon for assessing how their balance sheets will weather risks arising from the transition of the economy away from polluting industries, according to Alvarez & Marsal. Yet the BoE is asking banks to also look three decades out when considering physical risks like extreme weather or wildfires, while the ECB is using a one-year horizon, the analysis shows.

“The ECB’s test covers more areas than that of the BoE, even if they use the same scenarios,” said de la Mora. But he says there will “probably be limited impact on capital” from the tests, because the goal first and foremost is to “push banks to build up their capabilities.”

US unemployment claims rise after hitting pandemic lowAP — WASHINGtON

The number of Americans seeking unemployment benefits moved up last week to 332,000 from a pandemic low, a sign that worsening COVID infec-tions may have slightly increased layoffs.

Applications for jobless aid rose from 312,000 the week before, the Labor Department said yesterday. Jobless claims, which generally track the pace of layoffs, have fallen steadily for two months as many employers, struggling to fill jobs, have held onto their workers. Two weeks ago, jobless claims reached their lowest level since March 2020.

The increase was small and may be temporary. The four-week average of jobless claims, which smooths out fluctuations in the weekly data, dropped for the fifth straight week to just below 336,000, the lowest since the pandemic began.

Separately, the Commerce Department reported that retail sales unexpectedly rose 0.7 percent last month, a sign that Americans kept spending

despite the rise in coronavirus cases. But how they spent con-tinues to be altered by the pan-demic. Online shopping jumped in August but spending at res-taurant, bars and other busi-nesses that rely on crowds, appear to have gone into a holding pattern.

Unemployment aid appli-cations jumped 4,000 in Loui-siana, evidence that Hurricane Ida led to widespread job losses in that state. Ida will likely nick the economy’s growth in the current July-September quarter, though repairs and rebuilding efforts are expected to make up

for some of that in the coming months.

Still, Ida shut down oil refin-eries in Louisiana and Missis-sippi about two weeks ago and left more than 1 million homes and businesses without elec-tricity. But Ida’s impact was limited: Applications for jobless aid fell slightly in Mississippi.

The job market and the broader economy have been slowed in recent weeks by the delta variant, which has dis-couraged many Americans from traveling, staying in hotels and eating out. Earlier this month, the government reported that

employers added just 235,000 jobs in August after having added roughly a million people in both June and July.

Hiring in August plummeted in industries that require face-to-face contact with the public, notably restaurants, hotels and retailers. Still, some jobs were added in other areas, and the unemployment rate actually dropped to 5.2 percent from 5.4 percent.

The steady fall in weekly applications for unemployment benefits coincides with a scaling-back of aid for jobless Americans. Last week, more than 8 million people lost all their unemployment benefits with the expiration of two federal programs that covered gig workers and people who have been jobless for more than six months. Those emergency programs were created in March 2020, when the pandemic first tore through the economy.

An additional 2.7 million people who are receiving regular state unemployment aid lost a $300-a-week federal unemployment supplement last week.

A file photo of people shopping at macy’s department store inside roosevelt Field shopping mall in garden City, New York, US.

IMF okays $67m aid to Equatorial GuineaANAdolU — KIGALI, rWANdA

The International Monetary Fund (IMF) said yesterday it approved $67m emergency support for Equatorial Guinea to help it deal with the economic fallout of the coronavirus pandemic and explosions at a military base.

“The Bata explosion and still unfolding COVID-19 pandemic have inflicted heavy damage on Equatorial Guinea, substantially weakening the prospects for eco-nomic evolution, increasing eco-nomic and financial difficulties, and seriously affecting the incomes of a large part of the population,” the IMF said in a statement.

The explosions at a depot in a military barracks, which destroyed much of the mainland city of Bata, left 105 people dead

in March.“What is strange though is

that the country is endowed with oil and other natural resources. The president of Equatorial Guinea is one of the richest in Africa. His son is the vice pres-ident with assets in the US and Europe. But the country remains poor and can depend on IMF

funding,” Oscar Kimanuka, a Kigali-based political analyst, told Anadolu Agency.

After Nigeria and Angola, Equatorial Guinea ranks second among Africa’s oil producers alongside Sudan, South Sudan and neighbors the Republic of the Congo and Gabon.

The pandemic and the explo-sions increased external financing needs in the balance of payments by $625m, repre-senting 5 percent of the gross domestic product this year, according to the IMF.

It added that in view of the double shocks the government reacted “adequately” by increasing health spending and promoting social assistance.

President Teodoro Obiang Nguema Mbasogo, 79, has ruled Equatorial Guinea for more than

41 years.France’s highest appeal court

in July upheld a guilty verdict in embezzlement charges against Vice President Teodoro Nguema Obiang Mangue, who is also the president’s son, paving the way for the potential return of tens of millions of dollars for redistri-bution to citizens of the West African country.

Mangue, 52, was handed a three-year suspended sentence and fined €30m ($33m) in absentia in 2020 and his luxury assets were confiscated. French judicial authorities estimated that he laundered roughly €150m to build up the assets which include a luxury residence reportedly located on Avenue Foch in Paris – featuring 101 rooms, a gym, a hair-dressing studio, and a disco with a cinema screen.

The Bata explosion and still unfolding COVID-19 pandemic have inflicted heavy damage on Equatorial Guinea, substantially weakening the prospects for economic evolution, increasing economic and financial difficulties.

Argentina budget targets 4% growth in 2022

Turkish Central Bank reserves top $120bn

BUENOS AIRES: Argentina’s economy is predicted to grow 4 percent in 2022, while inflation is expected to hit 33%, according to a draft budget released just before midnight on Wednesday that lays out the embattled government’s economic roadmap for next year. The draft, which must be approved by the country’s Congress, also pegged the key fiscal deficit number at 3.3 percent of GDP, as the South American grains producer grapples to claw its way back to economic growth while dealing with a large pile of foreign debt.

The midnight budget came the same day as Argentina’s Per-onist government was shaken after several hard-left ministers offered their resignations, signalling a rift within the ruling coa-lition after a bruising primary election loss. The government of center-left President Alberto Fernandez was badly beaten on Sunday in an open primary election, seen as a reliable indicator ahead of a midterm congressional vote in November where the ruling party could lose its grip on Congress.

Fernandez, who met with loyalist ministers on Wednesday to rally support, will need to decide whether to accept the resigna-tions of ministers and officials allied with his divisive but pow-erful Vice President Cristina Fernandez de Kirchner.

At an event on Wednesday, President Fernandez said that the budget assumed the country would strike a deal with the Inter-national Monetary Fund to revamp some $45bn in repayments it cannot make and that he would push forward talks. “We present the budget assuming that next year we do not have to meet external commitments,” he said. “But that requires continuing the nego-tiation with the Fund and achieving it.” -Reuters

ANKARA: The Turkish Central Bank’s total reserves rose by $944m to hit $120.1bn last week, for the first time since November 2016. According to weekly money and bank statistics published by the bank, the gross foreign exchange reserves increased by $1.6bn to $79.6bn on September 10, from $78.5bn on September 3.

The reserve increase was largely driven by swap agreements, reserve requirement arrangements, IMF funding, rediscount returns, and gold from ore.Meanwhile, gold reserves decreased by $670m to $40.5bn in the said period, from $41.1bn on September 3.

On Wednesday, the bank raised reserve requirement ratios for foreign currency and precious metal deposit accounts.Announcing the move in the Official Gazette, it increased the ratio by 200 basis points for all such accounts.Following the decision, the ratio reached 23 percent for foreign currency deposit accounts – demand, notice and up to one-year maturity – and 17 percent for foreign currency accounts with a maturity of one year or more.

Last month, Turkey's President Recep Tayyip Erdogan said the Turkish Central Bank's reserves would surpass $115bn when pending transactions were completed.There are two items that will increase the bank's gross reserves in the coming period.

With the bank's latest required reserve regulation, the amount of foreign currency held by banks in the Central Bank is expected to increase by $3.4bn to over $65bn. -ANADOLU

IN BRIEFZimbabwe seeks investors for dollar-bondBloomBerg

Zimbabwe will seek to raise $200m in a debut domestic US dollar bond sale on its stock exchange in Victoria Falls that trades exclusively in foreign currency, according to finance Minister Mthuli Ncube.

“We may have it in small tranches, rather than a single big issuance,” Ncube said in an interview from New York, where he is on a roadshow to attract investment into the southern African nation. “We might put it in $30m tranches of about six issuances.”

Zimbabwe is targeting a yield of 6 percent to 9 percent on the bonds, he said on Bloomberg Television. Yield-hungry investors in frontier markets are interested in the offering, the minister said.

Earlier this month, Bloomberg reported that the bond sale would be for $100m. In August, Ncube said a debt offering could help meet the

cost of a $3.5bn compensation bill the country is facing after it reached an agreement with White farmers evicted from their land two decades ago.

The so-called “Zimbabwe Global Investor Roadshow” has seen Ncube travel to South Africa and Dubai to court foreign investment. In New York, Ncube will also meet with officials from the International Monetary Fund and the World Bank, ahead of an IMF visit to

Zimbabwe that’s expected next month.

The government has been building up a track record of repaying its foreign debt by making token payments to creditors, including the Paris Club, Ncube said. The country defaulted on payments to the World Bank, the IMF and other multilateral lenders two decades ago.

To reduce investor risk, Ncube said revenue that the government earns in US dollars, such as from mining exports, will be ring-fenced to make coupon payments on the debt.

“We also want to source some insurance to further insure the returns for the investors,” he said.

The IMF is expected to make a decision on a new staff-monitored program for Zim-babwe later this year, according to Ncube. The IMF in February 2020 abruptly ended the program saying it had “gone off track.”

Zimbabwe is targeting a yield of 6 percent to

9 percent on the bonds. Yield-hungry investors in

frontier markets are interested in the offering.

Mthuli NcubeZimbabwe's Finance Minister

Global growth to hit 5.3%, fastest in 5 decadeANAdolU — ANKArA

Global economic growth is esti-mated to hit 5.3 percent this year with the recovery from the pandemic, its fastest rate in nearly five decades, according to a UN report. "The recovery, however, is uneven across geographical, income and sectoral lines," the United Nations Conference on Trade and Devel-opment (UNCTAD) said in the report. "Within advanced econ-omies, the rentier class has expe-rienced an explosion in wealth, while low-earners struggle."

UNCTAD said policymakers in advanced economies have not yet realized the size of eco-nomic shock to developing countries, or its persistence, adding: "Many countries in the South have been hit much harder than during the global financial crisis, while their now-heavier debt burden reduces their room for fiscal policy."

Ooredoo Group, CK Hutchison agree $6bn Indonesian mergerFROM PAGE 09

This merged company will deliver sig-nificant value and benefits for all stake-holders including Indosat Ooredoo and Ooredoo Group shareholders, for customers, employees and Indonesia. Through econ-omies of scale and the realization of synergies between these highly complementary busi-nesses, the merged company will be well placed to deliver a higher return on investment for all shareholders and build on the outstanding growth momentum already achieved by Indosat Ooredoo. Importantly, the merger will create a company with the strength and scale to accelerate Indonesia’s digital transformation and improve network performance and customer experience across the country.

Finally, I would like to express our most sincere gratitude to the Government of Indo-nesia for its progressive policies that are ena-bling this consolidation and the creation of a more sustainable telecoms industry, which will benefit customers, all operators, local shareholders and the people of Indonesia.”

Canning Fok, Group Co-Managing Director of CK Hutchison Holdings Limited, said: “This is a great opportunity to create a

stronger and more innovative telco player in Indonesia and will be an accretive trans-action for shareholders and other stake-holders alike. Indosat Ooredoo Hutchison will have a critical mass that will enable it to drive network expansion and improvements that will support the Government’s digital agenda and benefit customers and Indonesia as a whole.

With greater scale, expanded spectrum, and a more efficient cost structure, Indosat Ooredoo Hutchison will also be better posi-tioned to extend the rollout of its network and enhance service quality and speed. CK Hutchison invests in and operates telecom businesses in 12 markets around the world, many of which have successfully rolled out 5G networks, and we look forward to expanding innovative 5G services in Indo-nesia when the time is right.

I would like to thank Ooredoo Group for the commitment to this process. We have had fruitful discussions on how we can build a strong business together over the past few months, and I look forward to building a lasting and successful partnership together.

Finally, I would also like to express grat-itude to the Government of Indonesia. Its

foresight in creating an investment friendly policy environment is helping to build a strong and sustainable mobile market in Indonesia.”

Sheikh Faisal Bin Thani Al Thani, Chairman of the Board of Directors at Ooredoo Group, concluded: “This merger is a landmark deal for Asia and for Ooredoo Group. It furthers our strategy to drive more value from our portfolio and accelerate digi-talization across our global footprint. I look forward to a long and successful partnership with CK Hutchison and to working together to build Indosat Ooredoo Hutchison into a digital champion for Indonesia.”

Completion of the transaction will be subject to the approval of Ooredoo Group, CK Hutchison, Indosat Ooredoo share-holders, regulatory approvals and other cus-tomary terms and conditions. Assuming all approvals are received, the proposed com-bination is expected to be completed by the end of 2021.

JP Morgan is acting as exclusive financial advisor to Ooredoo Group. Goldman Sachs & Co. and HSBC are acting as joint financial advisors to CK Hutchison. Barclays is acting as financial advisor to Indosat Ooredoo.