Axiata Up 2.4% on Bargain Hunting After Failed Telenor Tie-Up

   By Yantoultra Ngui

KUALA LUMPUR, Malaysia--Shares of Axiata Group Bhd. (6888.KU) rose Wednesday, with investors taking advantage of the stock's dive following the failed merger with a unit of Norway's Telenor ASA (TEL.OS).

Shares of Axiata--Malaysia's largest telecom company by market capitalization--ended the morning trading session 2.4% higher at MYR4.21, making it one of the top gainers on the local bourse. Shares of Telenor's Malaysian unit, DiGi.com (6947.KU), were down 0.2% at MYR4.59.

Axiata and Telenor had in May announced that they were discussing a possible noncash merger of their Asian telecom and infrastructure assets that would have created one of Asia's largest telecom companies with potential annual revenue of $12 billion. On Friday, they said the deal was off. Axiata shares slipped almost 16% Tuesday, the first day of trading following that news with markets in Malaysia closed on Monday due to a public holiday.

"We believe the steep decline in Axiata's share price has largely priced in investors' disappointment on the termination of the Axiata-Telenor merger discussion," Kuala Lumpur-based Affin Hwang Capital said in a research note.

The investment bank upgraded Axiata, which is majority-owned by Malaysia's sovereign wealth fund Khazanah Nasional Bhd., to a hold rating from sell, with an unchanged target price of MYR4.25, citing stronger-than-expected overseas earnings and possible mergers and acquisitions.

Write to Yantoultra Ngui at yantoultra.ngui@wsj.com.

(END) Dow Jones Newswires

September 11, 2019 02:22 ET (06:22 GMT)

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