Axiata Group Bhd and PT Sinar Mas Group have announced the merger of their telecommunications units in Indonesia.

The combined entity, valued at US$6.5 billion, will operate as XLSmart Telecom Sejahtera starting April next year.

According to the merger terms, PT XL Axiata shares are valued at 2,350 rupiah (US$0.15) each.

PT Smartfren Telecom shareholders will receive 0.011 XL shares per Smartfren share.

Both Axiata and Sinar Mas will jointly control the new entity, each holding a 34.8% stake.

Negotiations for this merger began over three years ago.