TOT and CAT Telecom have been urged to jointly draft a proposal if they want to participate in the planned auction of 5G spectrum licences to create sustainable revenue, says the Digital Economy and Society (DES) Ministry.
The proposal has to be presented to the ministry by Oct 30, said DES Minister Buddhipongse Punnakanta after meeting with TOT and CAT management yesterday.
The ministry has set out a plan to combine TOT and CAT into a single entity, known as National Telecom Co (NT).
The new organisation is scheduled to start operating by the second quarter of next year.
Mr Buddhipongse said he wants to see synergy from the two enterprises' management such as strategic management, creating new business models and financial feasibility.
TOT holds the licences of the 2100 and 2300 megahertz spectrum ranges that are due to expire in 2025, the same year the 850MHz spectrum licence occupied by CAT Telecom expires.
TOT has provided mobile services on the 2100MHz range through a partnership agreement with Advanced Info Service and the 2300MHz range with Total Access Communication.
CAT Telecom provides mobile services via a partnership agreement with True Move Universal Communication.
Mr Buddhipongse said if the two organisations come up with a constructive merger plan, the ministry will accelerate the process of submitting it to the cabinet for approval.
If the plan has weak points, the merger process may not happen quickly, he said.
"A merger is needed for the two enterprises," said Mr Buddhipongse.
"But this merger may not yield benefits if it is done without a clear strategic move regarding what benefits would be created from being a single organisation."
He said he has not been informed about the details of the benefits from the merger plan or the business model.
"Only benefiting from investment redundancy of several billion baht for the next 6-7 years may not be sufficient," said Mr Buddhipongse.
The merger plan was formulated in 2018 as a solution by the government to keep the two state enterprises afloat.
The merger has been approved by the State Enterprise Policy Committee.
Mr Buddhipongse has previously asked TOT and CAT Telecom management to thrash out three core issues for the merger: employee and management structure, their existing business agreements and contracts with other private companies.
The government has made it clear the merger will not affect the employees of the two organisations.