Indonesia’s Business Competition Supervisory Commission (KPPU) will today announce its ruling concerning a probe into Singaporean state investment vehicle Temasek Holdings’ business affairs in the country’s mobile phone market. The anti-trust agency has been investigating whether or not Temasek, which through its telecoms assets has stakes in local mobile operator Telkomsel and Indonesia’s number two telco Indosat, has used its position and influence to undermine competition in the industry. If the KPPU finds Temasek guilty, the state investment arm could be fined up to USD10.7 million, or forced to reduce its holdings in the sector – most probably all or part its stake in Indosat. The investment arm’s wholly owned ST Telemedia (STT) unit owns 75% of Asia Mobile Holdings, which itself has a 41.9% interest in Indosat, owner of mobile network operator Satelindo. STT acquired the stake in 2002 for USD634 million, but has seen the equity’s value soar to USD2.2 billion today. Temasek also holds 54.15% of Singapore Telecommunications which itself has a 35% interest in Telkomsel. Together, the two Indonesian companies control more than 80% of the domestic mobile market.
Temasek and STT deny any wrong doing in a deal which was originally sanctioned by the government, while The House of Representatives has called on the KPPU to maintain its neutrality and objectivity in dealing with the anti-monopoly case.