U Mobile confirmed Straits Mobile Investment agreed to reduce its stake in the operator from 49 per cent to 20 per cent to boost its Malaysian ownership after being selected to run the country’s second 5G network.

In a statement, U Mobile noted the move to increase local partnership supports its “dedication to national interests”. It has not revealed names of potential local investors.

The operator added it is confident the second Malaysia 5G network will “translate into better and more affordable services to the public through healthy and sustained competition” and emphasised it will use only private sector funding, with no reliance on government funds.

Earlier in the month, the Malaysian Communications and Multimedia Commission named U Mobile as the country’s second 5G network provider, with the operator committing to reduce its foreign shareholding to 20 per cent.

The current 49 per cent foreign equity holding is within the limit set by the conditions of the licence U Mobile holds, the Communications Ministry stated. But questions raised about its selection over market leader CelcomDigi and Maxis prompted U Mobile to commit to cutting the foreign holding.

It joins Digital Nasional Berhad (DNB), a wholly owned unit of the Ministry of Finance, in building out a nationwide 5G network in Malaysia. DNB started work on the controversial single 5G network in 2021 and now targets 85 per cent population coverage of by end-2024.