Telekom Malaysia is reported to have upped its offer price for a stake in Indonesia’s third largest cellular operator Excelcomindo after coming under pressure from rivals such as China Telecom, which are also looking to purchase a stake in the cellco. Telekom Malaysia was forced to raise its bid after its initial offer was discarded as being too low. It has not revealed the value of the bid, or what percentage stake it is hoping to purchase, but analysts believe that it is looking to buy at least a majority stake, if not 100%.
Malaysia’s mobile market possesses excellent potential for growth: at the end of 2002 only 7% of the country’s 210 million people used mobile phone services, but this figure is expected to grow by 58% in 2003 and a further 30% in 2004. Telekom Malaysia recently spent IDR4 billion to take over Malaysia’s Celcom, and also holds stakes in operators in Sri Lanka, Bangladesh, Ghana and South Africa. Excelcomindo reported total assets of IDR4.7 trillion (USD554 million) in the first half of 2003, but it has a large debt which it is currently trying to restructure; in September 2003 it detailed plans for a IDR1.25 trillion bond issue, saying it might make an initial public offering of shares in late 2004 or early 2005.