Here is one of the biggest news from the telecom industry of Pakistan. For the first time in Pakistan, two telecom companies are going to merge into a single entity. Mobilink, the largest 3G network is shaking hands with Warid, the largest postpaid network. Both Mobilink and Warid will merge into one company, serving over 45 million combined customers.

VimpelCom, the group behind Mobilink and the Dhabi Group has reached on an agreement in Dubai. The agreement has been signed between the both companies to merge their subsidiary groups i.e. Mobilink and Warid. Here are few key points regarding Mobilink and Warid agreement:

• The merging of Mobilink and Warid will now get approved from SECP and PTA.
• The whole process of merging will complete in six months after the approval from regulatory authorities.
• Mobilink’s CEO Jeffrey Hedberg will become CEO of the combined business while Mobilink’s CFO Andrew Kemp will become CFO of the combined entity.
• The merged company will have seven board of directors, six to be nominated by VimpelCom and Mobilink while one by the Dhabi Group (Warid).
• The combined revenue of the merged company was of 1.4 billion dollars for 12 months till September 2015.
• This partnership will create Capex and Opex synergies with a net present value of approximately USD 500 million.
• Mobilink will, first, acquire 100 percent of Warid’s shares while in response, the Dhabhi Group will get 15 percent of shares of the combined company.

Below is an image of meeting between VimpelCom and Dhabi Group:

Here are official comments from Jean-Yves Charlier, CEO of VimpelCom:

We are delighted to announce the agreement with the Dhabi Group shareholders today to combine our businesses in Pakistan.

With the addition of Warid to our already strong customer base at Mobilink, we will serve more than 45 million customers and offer a best-in-class mobile and high-speed data network – a key factor in the digital enablement of Pakistan’s economy.

This transaction follows a number of strategic milestones for the company, including our recent joint venture announcement with WIND and 3 Italia in Italy and the agreement to sell our operations in Zimbabwe.

This is yet another important step in our journey to continue delivering on our strategy to transform VimpelCom and improve our competitive position in our operating markets.

His Highness Nahyan Mubarak Al Nahyan, Chairman of Dhabi Group said,

Creating the largest operator in Pakistan is a significant milestone for Mobilink and Warid but also for Pakistan as a whole.

Warid’s partnership with Mobilink will create value for all stakeholders and pave the way for exceptional and cost-efficient telecommunication services for customers.

Both parties bring their unique strengths to this merger. Warid, with its strong post-paid base and high quality 4G/LTE network will complement Mobilink’s position in the market.

We are very pleased to continue to contribute to the strengthening of the competitive landscape for the broader telecom sector and the overall economy of Pakistan. The transaction reaffirms my own and my fellow investors’ long-standing and continuing commitment to Pakistan.

Both the companies are yet to unveil their post-merging strategies. There are no details whether Warid will continue as a separate brand or not. However, this merging will certainly gonna create a tough competition for other telcos. So Mobilink and Warid users, what are your thoughts on this partnership?