The owners of PT XL Axiata and PT Smartfren Telecom are finalising details of a transaction that could be announced as soon as this week, the people said, asking not to be identified because the matter is private. The companies have been discussing the structure of a deal that may involve a mix of cash and shares, and that would create an entity with about 100 million customers, Bloomberg News reported in April.

Shares in XL Axiata have gained 15% this year, giving the company a market value of US$1.9 billion (RM8.4 billion). On the other hand, Smartfren’s shares have dropped 46% and its market value hovers at around US$812 million.

Talks are still ongoing and could still face delays, the people said. If it pushes through, a deal would cap more than three years of discussions.

A representative for the companies declined to comment.

The companies said in May that they had signed a non-binding memorandum of understanding. Both Axiata and Sinar Mas were seeking to remain as controlling shareholders of the merged entity, they added.

An Axiata-Sinar Mas deal would add to the list of Indonesian telecoms mergers over the past few years. CK Hutchison Holdings Ltd and Qatar’s Ooredoo QPSC completed a merger of their local telecoms businesses in 2022 in a US$6 billion transaction, as they sought to fend off competition.

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