Indosat considers StarOne spin-off plan

9 Feb 2011

Indonesia’s second largest telecoms group by subscribers, Indosat, is considering spinning off its code division multiple access (CDMA) unit StarOne in a bid to make the group more competitive. The Jakarta Post quotes the telco’s president Harry Sasongko as saying that Indosat is currently conducting an internal review ‘to gain momentum’ as the sector has shown ‘an upward trend’, with most of the nation’s 230 million people having access to a mobile phone. Although no decision has yet been taken, a constant slide of subscribers from StarOne has reportedly hampered Indosat’s overall growth, which is dominated by its cellular business. The idea of spinning off StarOne has been under consideration since 2008. ‘We will finalise a decision as soon as the assessment is done,’ Harry said.

Indosat is also looking to refinance debts in 2011 and 2012 using remaining funds it raised from bond sales. Indosat has USD420 million left from 2010’s bond sales which generated a total of USD650 million. Last year Indosat, which is owned by Qatar Telecom (Qtel), used USD230 million of the fund to repay debts.

Indonesia, Indosat Ooredoo (incl. IM2)