Made Arya Kencaya, Denpasar – Hundreds of employees of state-owned Telekomunikasi Indonesia rallied on Monday in front of the Bali Regional House of Representatives. They were protesting the planned merger of the company's CDMA unit, Telkom Flexi, with private mobile firm Bakrie Telecom due to concerns about job security.

Putu Edy Swantajaya, the chairman of the Telkom Bali Employees Union, claimed the merger plan was thrown together hastily. "It came in a rush and is potentially legally flawed," he said.

Reuters reported on Oct. 13 that Bakrie Telecom was set to acquire Flexi in a share deal worth up to $1 billion. The two CDMA operators have reportedly been in talks for sometime, but have never announced any details for the terms of the deal.

According to Reuters, Bakrie Telecom would issue new shares to be swapped with Telkom's CDMA assets worth between Rp 7 trillion and Rp 9 trillion ($784 million to $1 billion).

Reuters said the acquisition would be the biggest in Indonesia since Qatar Telecom took over Indosat in a $1.35 billion deal in 2008.

Putu said the merger between Flexi and Bakrie's CDMA service Esia meant state assets would be sold, meaning Flexi would be vulnerable to political intervention. He also questioned why a unit of Telkom, with an annual revenue of Rp 64 trillion, needed support from Bakrie Telecom.

Flexi is the country's largest CDMA operator, with around 15 million subscribers and a strong presence beyond Java. Bakrie Telecom has about 11 million subscribers, mostly in Java. But Eddy Kurnia, Telkom's corporate secretary, said a deal with Bakrie Telecom had not been reached yet.

"It is still a long way to go, we cannot say anything yet. [The workers] should not be worried, we will pay attention to their welfare," he said. Rahmat Djunaidi, Bakrie Telecom's director for corporate affairs, confirmed negotiations were ongoing.

"We are still discussing the merger plan. And we have not signed any documents," he said. Rahmat declined to comment on Monday's protests in Bali.