Both companies agreed to end discussions, Oslo-based Telenor said in a statement today, confirming an earlier Bloomberg News report.
Telenor cited “complexities” as the reason for the halt, without elaborating. Telenor shares slid as much as 7% in early Oslo trading.
Axiata said it would explore opportunities to consolidate and optimise its business. Hanne Knudsen, Telenor’s spokeswoman, said by phone that it would now be “business as usual” for the company in Asia, while not ruling out that talks could be picked up again later.
The decision to quash the deal comes months after Prime Minister Dr Mahathir Mohamad questioned how combining the companies would affect employment.
Telenor had cited about US$5 billion (RM21 billion) in synergies from the combination, which would have created a company with $13 billion (RM54.4 billion) of sales. The Norwegian telecom company was to have owned 56.5% of the merged entity under the plan.
Axiata’s board met today to discuss the planned merger and decided to cancel the deal, said a person familiar with the talks, who asked not to be identified as the matter is private.
Trading in Axiata shares was halted earlier, pending an announcement.
The companies had planned to have a final agreement on the deal by the third quarter, with Axiata CEO Jamaludin Ibrahim saying last month that the company was still sticking to its timeline for signing the agreement.
He cautioned that while most mergers centre on commercial interests, this one involves national interest and staff issues as well.