Telekom Malaysia has secured a 27.3% stake in Indonesia’s number three mobile operator, Excelcomindo (Excel), with a bid of USD314 million. The Malaysian telco beat off rival offers from other international operators including SK Telecom of Korea, Telenor of Norway and PLDT of the Philippines. Under the terms of the deal Telekom Malaysia will assume majority control of Excel’s management and supervisory boards. It says it is hoping to acquire further shares in its new subsidiary during 2005 to give it a majority shareholding.
Telekom Malaysia acquired its 27.3% stake from two of Excel’s original investors which were on board when the company launched services in 1996. Verizon of the US has sold its 23.1% stake, which it owned via the holding company Nynex Indocel, while the other 4.2% came from Mitsui of Japan. The remaining Excel shares are currently held by Telekomindo/Rajawali Group, which has a 60% stake, and the investment group AIF Capital which holds 12.7%.
Telekom Malaysia’s chief executive officer, Datuk Abdul Wahid Omar, said in a statement: ‘Telekom’s strategic vision is to help enhance Excel’s market position in Indonesia and, in the process, make Excel a substantial contributor to Telekom’s future growth. We believe our position as the Malaysian market leader, combined with our extensive experience as a regional investor, will be beneficial to Excel.’ He added: ‘Substantial synergies are available based on the level of voice and data traffic between Indonesia and Malaysia.’
Telekom Malaysia recently offloaded its shareholding in Telkom South Africa, which had been its major source of overseas revenue, but it plans to add to its operations in Asia with the acquisition of a stake in Indian operator Idea Cellular.
Excel had around 4.2 million subscribers at the end of September, giving it a 15.5% share of Indonesia’s fast-growing mobile market. The two largest operators, Telkomsel and Satelindo, both have foreign backers in the shape of Singapore companies SingTel and ST Telemedia respectively. With a population of 220 million and only around 27 million cellular subscribers, Indonesia has large potential for growth.