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TM to finalise P1 stake acquisition by 3Q14

9 May 2014

Telekom Malaysia expects to conclude its purchase of a stake in local wireless broadband operator Packet One Networks (P1) by the third quarter of 2014, the Star Online reports. TM’s chief executive officer Tan Sri Zamzamzaraini Mohd Isa was cited as saying that his company was still seeking regulatory approval for the deal, though this is expected to be granted within the next two months. In issuing an update on the progress of the deal, the executive reiterated the potential in the partnership with P1, stating: ‘P1 has 500,000 customers and they are operating in the area where perhaps TM is not very strong for its fixed line services availability … LTE is our long term plan, as for now we plan to stabilise the WiMAX businesses in P1, which we believe is a profitable business.’

As previously reported by TeleGeography’s CommsUpdate, in March 2014 TM confirmed that it had entered into an investment agreement with P1’s current owner Green Packet and strategic partner South Korea’s SK Telecom (SKT), to collaborate on developing a next-generation LTE network to offer customers a full-suite of converged communications services. Under the terms of the deal, TM said it would take a 57% stake in P1, while the agreement established a partnership framework for the three parties to share in the ownership and collaborate on the future growth of P1. As part of the investment agreement, TM will initially invest MYR350 million (USD92 million) into P1 via the subscription of new ordinary shares to make it the majority shareholder; Green Packet and SK Telecom will both remain key strategic shareholders upon completion of the transaction. Further, TM will invest up to MYR210 million into Green Packet via newly issued redeemable exchangeable bonds, which may be exchangeable for Green Packet’s stake in P1 in the future. Approval from both local regulatory bodies and Green Packet shareholders’ are required before the deal can move forward, however.

Malaysia, Telekom Malaysia, webe (formerly Packet One Malaysia)

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