Axiata Group Berhad and Sinar Mas jointly announced that shareholders of PT XL Axiata Tbk, PT Smartfren Telecom Tbk , and PT Smart Telcom have formally approved the merger of the three companies.
The approval was secured following Extraordinary General Meetings of Shareholders (EGMS) held on 25 March 2025 by XL Axiata, Smartfren, and SmartTel. This follows prior in-principle regulatory approvals from Indonesia’s Ministry of Communication and Digital Affairs and the approval of Indonesia Stock Exchange (IDX) and Financial Services Authority (OJK), further solidifying institutional support for the strategic consolidation.
With a subscriber base exceeding 94.3 million, annual projected revenue of IDR 45.8 trillion, and an EBITDA of IDR 22.5 trillion, XLSMART is well-positioned to lead the next phase of growth in Indonesia’s telecommunications sector. The landmark merger is also set to realise significant cost synergies, with an estimated annual run-rate pre-tax synergies of US$300 to $400 million post integration completion. Following the completion of the merger, Axiata Group and Sinar Mas will become the joint controlling shareholders, with each holding a 34.8% stake in XLSMART, with equal influence over its strategic direction and decisions.
To strengthen the collaboration beyond XLSMART, Axiata and Sinar Mas on 28 January 2025, signed 2 Letters of Intent (LOI’s), at a ceremony witnessed by Malaysian Prime Minister Dato’ Seri Anwar Ibrahim and The President of The Republic of Indonesia Prabowo Subianto at the Petronas Twin Towers in Kuala Lumpur – this coincides with Malaysia’s role as the chair of ASEAN, a position that allows the country to influence the regional agenda and drive collective objectives.
These LOIs laid the groundwork for deeper collaboration between the two companies, focusing on potential synergies in Malaysia, Indonesia, and Southeast Asia. The agreement envisioned joint efforts in advanced 5G solutions, enterprise services, digital infrastructure, and fintech innovations, supporting the broader goal of accelerating digital transformation across the region. The shareholder approvals mark a critical step forward in realising that vision and advancing strategic cooperation between the two companies.
As part of the newly formed company’s leadership, Rajeev Sethi has been appointed as President Director & CEO, supported by an executive team that includes nine directors and nine commissioners, ensuring a well-balanced representation from both XL Axiata and Smartfren. Rajeev has extensive and successful experience in transforming telecommunications companies in emerging markets that will help XLSMART to realise its synergy values, and was previously the CEO at Robi Axiata Bangladesh.
The merged entity will combine Axiata’s regional expertise and deep experience in managing integrated operations with the local knowledge and established presence of Sinar Mas, creating a larger, financially robust organisation.
Franky Oesman Widjaja, Chairman of Sinar Mas Telecommunications & Technology commented that by combining XL Axiata’s solid infrastructure with Smartfren’s customer-focused digital services, XLSMART will offer enhanced connectivity solutions that empower consumers and businesses while supporting the nation’s long-term digital aspirations. We are excited for the opportunity to drive meaningful progress for Indonesia’s digital economy, ensuring that our customers, partners, and stakeholders benefit from increased efficiency, broader coverage, and superior service quality.”
Meanwhile, Vivek Sood, Group Chief Executive Officer of Axiata Group said the merger is not only about combining two businesses but about creating a new, forward-looking company that will set benchmarks in innovation, service quality, and operational excellence. We believe this business combination will allow for the improved financial health of the industry, and we are confident XLSMART will emerge as a formidable player—enabling us to significantly accelerate investments in digital infrastructure and innovation, and ultimately empower communities.”
Three brands (XL, Smartfren and Axis), which are already well-positioned in their respective customer segments and complementary, will continue. Over the coming months, however, Axiata and Sinar Mas said they will work closely to align business operations, optimise network infrastructure, and explore new service offerings that capitalise on the strengths of the merged entity.
