Aug 19, 2016

    Singtel to buy telco stakes from Temasek

    SINGAPORE Telecommunications (Singtel) said yesterday it plans to buy a 21 per cent stake in Intouch Holdings and a 7.39 per cent stake in Bharti Telecom (BTL) from Temasek Holdings for $2.47 billion.

    The acquisitions will be fully settled in cash - using internal cash, short-term debt and proceeds from a placement of 386 million new Singtel shares to Temasek at $4.16 each, or $1.61 billion in total.

    Singtel is 51.12 per cent owned by Temasek.

    Ravi Lambah, Temasek's head of telecommunications, media and technology, said: "As an active investor, we rebalance our portfolio from time to time.

    "We accepted the offer after careful evaluation, and believe the potential synergies gained from the acquisitions will be positive for all Singtel shareholders over the long term.

    "Reflecting this view, we are pleased to have the opportunity to further invest in Singtel - the largest company in our portfolio - as part of this set of transactions."

    Intouch holds a 40.45 per cent stake in Thailand's largest mobile operator, Advanced Info Services Public Company (AIS), and about 41.14 per cent of Thaicom.

    Singtel has an interest of 23.32 per cent in AIS.

    After the acquisition of part of Temasek's stake in Intouch, Singtel will own 21 per cent of Intouch.

    As for BTL, the Indian telco holds about 45.09 per cent of Bharti Airtel.

    Singtel currently has a 39.78 per cent interest in BTL and an interest of 15.01 per cent in Bharti Airtel.

    After the purchase of the BTL shares, Singtel's interest in BTL will increase to 47.17 per cent.

    Singtel said the purchases would increase its exposure to quality assets.

    Intouch and BTL own assets that are leaders in their respective markets, with strong track records of earnings growth.

    AIS and Bharti Airtel have secured spectrum holdings for the long term and invested extensively in their networks.

    The transaction is expected to be completed by December.