Singtel will boost its stakes in the largest mobile operators in Thailand and India – AIS and Bharti Airtel – with an investment of SGD2.47 ($1.84 billion).
Singtel has entered into a conditional share purchase deal with state-investment firm Temasek Holdings to acquire 21 per cent of Intouch Holdings, which owns a 40.6 per cent stake in AIS. Temasek holds a 41 per cent stake valued at $2.4 billion in the Thai operator. Singtel currently has a 23.3 per cent stake in AIS.
The Wall Street Journal reported earlier in the week that Singtel was again looking to purchase a stake in Intouch Holdings. It first attempted to work out a deal in 2013.
Singtel will also acquire 7.39 per cent of Bharti Telecom, the holding company of Bharti Airtel in India. Singtel currently has a 32.5 per cent interest in Airtel.
Singtel is Singapore’s largest mobile player and also has stakes in operators across Asia. In addition to AIS and Airtel, its partners include Optus in Australia, Telkomsel in Indonesia and Globe Telecom in the Philippines.
“Thailand, India and Africa continue to be attractive, high-growth markets for us,” Singtel CEO Chua Sock Koong said in a statement, noting that the acquisitions are in line with its long-term strategy to increase exposure to its high-performing regional partners.
Singtel, which is 51.1 per cent owned by Temasek, said the transactions will be funded through internal cash, short-term debt and proceeds from a share placement of 386 million new Singtel shares to Temasek totalling SGD1.605 billion. The deals and the share placement are subject to minority shareholder and regulatory approvals.
It noted that the acquisitions and share placement are interdependent and have to close at the same time.
The regional operator, which reported its fiscal Q1 net profit was unchanged from a year ago, said its regional mobile associates’ pre-tax earnings expanded 14 per cent, with profit growth at both Airtel and AIS increasing 10 per cent in local currency terms.
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