A potential deal to reshape Malaysian mobile services
Maxis Bhd has asked a select group of banks and law firms to submit advisory proposals as it revives merger discussions with U Mobile Sdn Bhd, according to people familiar with the matter. The talks bring together a listed operator valued at about RM28.3 billion and a private rival whose owners may seek RM10 billion or more.
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A combination could create Malaysia's largest wireless operator by market value, overtaking CelcomDigi Bhd, which is valued at about RM29 billion. The negotiations also involve a company with a central role in the country's telecommunications plans: U Mobile was selected to build Malaysia's second 5G network.
Both sides are showing greater willingness to negotiate after earlier discussions stalled over valuations, the people said. Maxis could choose advisers shortly. The companies have discussed a possible combination intermittently for several years, including preliminary discussions in 2024.
The deliberations remain ongoing, with no certainty of an agreement. No transaction structure, agreed price or timetable for completion has been announced. For customers, the immediate development is a negotiation between company owners, with any changes to services dependent on what they eventually agree and implement.
What the proposed valuations mean
Maxis shares have fallen around 5% in the year covered by the merger account, leaving its stock market value at approximately RM28.3 billion. Market value, also called market capitalisation, is the share price multiplied by the number of shares a company has issued.
U Mobile is privately held, so it has no publicly traded share price. Its owners may seek a valuation of at least RM10 billion, according to people familiar with the discussions. The price would therefore have to emerge through negotiation.
Adding RM28.3 billion and RM10 billion gives RM38.3 billion, about RM9.3 billion above CelcomDigi's cited RM29 billion valuation. The eventual value of a combined company would depend on the agreed price, financing and ownership structure, as well as how investors valued the business.
CelcomDigi is therefore the benchmark for the claim that a merger could create the country's biggest wireless operator by market value. Customer numbers, revenue and network reach are different measures of size, each requiring its own figures.
Who controls the two companies?
Maxis is backed by the holding company of the late Malaysian tycoon T Ananda Krishnan. A representative of his private investment vehicle, Usaha Tegas Sdn Bhd, declined to comment on the discussions.
U Mobile is controlled through Mawar Setia Sdn Bhd, a company backed by Malaysian princess Tun Aminah Sultan Ibrahim Ismail and businessman Tan Sri Vincent Tan. Mawar Setia owns more than 50% of U Mobile, giving it a majority stake.
Tun Aminah is the daughter of Sultan Ibrahim Sultan Iskandar, the hereditary ruler of Johor, who became Malaysia's King in 2024 for a term of five years under the country's rotating monarchy system.
Singapore Technologies Telemedia, part of Singapore state investment firm Temasek Holdings, reduced its U Mobile holding to 20% after agreeing to sell part of its stake to Mawar Setia. Tan declined to comment on the merger discussions, while representatives of U Mobile and ST Telemedia did not respond to queries.
Why U Mobile's 5G role matters
U Mobile's position changed when the Malaysian Communications and Multimedia Commission, known as MCMC, selected it in 2024 to implement the country's second 5G network. That gave the company responsibility for a major piece of Malaysia's communications infrastructure alongside its existing mobile business.
In its 5G rollout statement dated 2 November 2024, U Mobile thanked the government for the selection and said it was ready to proceed. The company described plans to deliver 5G Advanced services, a newer stage of 5G technology intended to support more capable mobile connections.
U Mobile subsequently received MCMC's official letter of award for deploying the network. Chief executive officer Wong Heang Tuck said the mandate positioned the company to support Malaysia's ambition to become a regional digital economy leader. Explaining that commitment, Wong said:
We are committed to supporting the nation's digital transformation by driving 5G adoption and supporting Malaysia's aim of becoming a high-income digital nation,
U Mobile completed migration to its own nationwide ULTRA5G network on 1 July 2026, the company confirmed in its network transition statement dated that day. Its wholesale access agreement with Digital Nasional Bhd, known as DNB, ended with effect from the same date. The company said migration had been carried out progressively and all customers had been transitioned to its own network. Its network responsibilities give the negotiations another practical dimension: the owners are discussing a business that must continue operating and investing while talks proceed.
U Mobile said its rollout began in July 2025 and had reached more than 85% coverage of populated areas by 1 July 2026. It had also deployed more than 190 in-building coverage sites nationwide, with plans to expand to over 600.
Local ownership was part of the network plan
U Mobile tied its 5G plans to a change in ownership in November 2024. The company said it would reduce foreign majority shareholding to 20%, increase Malaysian control and invite participation from local investors.
The later ownership position, with Mawar Setia holding more than half and ST Telemedia retaining 20%, places Malaysian shareholders at the centre of decisions about U Mobile's future. Any merger negotiation therefore brings together both a proposed business combination and the ownership arrangements surrounding a national network project.
U Mobile's November statement also named organisations it expected to work with. They included MCMC, CelcomDigi and Telekom Malaysia, as well as technology provider Huawei and Digital Nasional Bhd, known as DNB. U Mobile said it would work with DNB to maintain customers' 5G experience.
CelcomDigi consequently appears in two roles in this story: as the listed rival whose market valuation a combined company could exceed, and as one of the telecommunications companies U Mobile named in its rollout plans. Competition for customers and cooperation on network delivery can exist within the same industry.
How the discussions developed
Maxis and U Mobile have returned to the negotiating table several times. The current effort follows an earlier attempt in which the parties could not agree on valuations, making the price assigned to U Mobile a central issue in the renewed talks.
The main developments span several stages:
- 2024: Maxis considered buying U Mobile and held preliminary discussions.
- 2 November 2024: U Mobile publicly welcomed its selection to implement Malaysia's second 5G network and announced plans to reduce foreign ownership to 20%.
- Later: U Mobile confirmed receipt of MCMC's official letter of award for the network deployment.
- 1 July 2026: U Mobile confirmed completion of migration to its own nationwide ULTRA5G network, with its DNB wholesale access agreement ending with effect from the same date.
- Renewed discussions: Maxis invited selected banks and law firms to submit proposals for advisory work.
Banks and lawyers would help assess how a transaction could be priced and organised. Their involvement would move preparations forward, while the owners would still need to settle the commercial terms.
What the companies are saying
Maxis has offered a broad statement about its approach to potential transactions. A company spokesperson described the opportunities Maxis considers using the following words:
is always evaluating strategic opportunities and partnerships that are value-accretive
The spokesperson also said Maxis would disclose material developments. In this context, value accretive means an opportunity expected to add value to the business or its shareholders. Material developments are changes important enough to affect investors' assessment of the company.
U Mobile's public comments have focused on its network mandate. Wong pointed to more than 17 years of experience, while the company welcomed the government's vision for two 5G networks, saying it would support competition, innovation and the sustainability of the industry.
For customers, the practical issues are service continuity, coverage and the plans offered by their operator. For shareholders, the immediate questions are the purchase price and the share of any combined business they would own. Those interests converge on whether the companies can agree terms while continuing their existing network commitments.
Key Points
- Maxis has sought proposals from banks and law firms as merger talks with U Mobile regain momentum.
- Maxis is valued at about RM28.3 billion, while U Mobile's owners may seek RM10 billion or more.
- A combination could exceed CelcomDigi's approximately RM29 billion market value.
- U Mobile was selected in 2024 to implement Malaysia's second 5G network and later received MCMC's official award letter.
- U Mobile confirmed completion of migration to its own nationwide ULTRA5G network on 1 July 2026, reporting more than 85% coverage of populated areas.
- Mawar Setia owns more than 50% of U Mobile, while ST Telemedia holds 20%.
- No agreement, final price or completion timetable has been announced.
