Brokers Maintain Positive View on TRUE-DTAC Merger despite Rejection from NBTC Subcommittees

The share price of Total Communication Public Company Limited (SET: DTAC) and True Corporation Public Company Limited (SET: TRUE) plunged sharply right after the opening of the afternoon session on July 22 over the report of a subcommittee voted against the amalgamation of DTAC and TRUE citing fewer options for users, which would burden by higher subscription price.

DTAC plunged as much as THB4.50 or 9.52% to trade at THB42.75 per share. TRUE fell as much as THB0.58 or 11.98% to trade at THB4.56 per share. Both securities were able to cut some losses afterward but still traded at a negative territory.

Due to the amalgamation of TRUE and DTAC, which are two of Thailand’s largest mobile operators, required a deep study before coming to a decision, the National Broadcasting and Telecommunications Commission (NBTC) had elected four subcommittees in each field to study the deal.

The latest report revealed that three of the subcommittees including consumer subcommittee, economy subcommittee and technology subcommittee, rejected the deal, but the final decision remains with NBTC after reviewing the reports from four subcommittees. The only approval from the subcommittee was from the legal field.


Maybank Securities (Thailand) (MST) made a quick comment on the matter, saying that it still believed NBTC would still approve the merger deal, but the negative views from the subcommittees could lead to harsher-than-expected measures and hence lower-than-expected cost synergies.

MST expected NBTC to use the inputs from the subcommittees to come up with proper measures to minimise the negative impact of the merger, especially on consumers.

The securities company assumed that the dual-brand measure would last three years (2023-25E). If the dual-brand measure lasts five years, MST stated that it would cut the post-merger fair values (excluding probability discount) for TRUE and DTAC by 2% to THB5.43/share and THB55.54/share, respectively. Also, the merged co’s FY26E core net profit would have to be cut to THB12.5 billion from c.THB17 billion due to lower cost synergies related to selling and marketing and shop rents.


Meanwhile, Capital Nomura Securities (CNS) noted that the final decision remains to NBTC and the securities company gave more than 80% probability that the deal would happen, but with conditions (same as the acquisition of Lotus’s from CP Group) and added that the deal would increase the technology and business transformation to have a potential to rival international businesses.