TeleGeography Logo

SPH, Keppel linked with possible buyout bid for Singapore’s M1

26 Sep 2018

Singapore Press Holdings (SPH) and a unit attached to Keppel Corp are mulling whether to submit a buyout offer for M1, Singapore’s smallest mobile network operator (MNO) by subscribers, Bloomberg reports citing people familiar with the matter. Unnamed sources say that Keppel Corp subsidiary Keppel Telecommunications & Transportation (Keppel T&T), which owns 19.23% of M1, and SPH, which holds 13.38%, may launch a bid in the coming days for the shares they do not already own in the MNO. The pair are understood to have approached M1’s largest shareholder, Malaysia’s Axiata Group, concerning a possible deal. The Malaysian carrier currently controls a roughly 28.54% stake in M1. Local press reports say that shares in both M1 and Keppel T&T were suspended this week, pending developments. Meanwhile, Bloomberg notes that Axiata may launch its own counterbid for M1 if the offer from SPH-Keppel is too low.

According to TeleGeography’s GlobalComms Database, in March 2017 the three firms issued separate statements confirming they were undertaking a strategic review of their M1 holdings, and appointed Morgan Stanley Asia (Singapore) as financial adviser to assist. Four months later, however, SPH submitted a regulatory filing to the Singapore Exchange, in which it said that having taken into consideration the proposals from interested parties – which despite a favourable level of interest had not met the minimum criteria and parameters determined by the majority shareholders – they had decided to drop the strategic review. ‘For the avoidance of doubt, no arrangement or agreement with any third party has been reached in relation to each majority shareholders’ respective shareholdings in M1 Limited,’ a statement for the three firms read.

M1 is estimated to be worth SGD2.05 billion (USD1.5 billion), valuing the primary stakeholders’ shares at more than SGD1.20 billion. However, Singapore’s smallest telecoms operator by subscribers and revenue has struggled of late. Having posted an 11.5% fall in net profits for FY 2017, its latest financial release (covering the three-month period to 30 June 2018) highlighted that service revenue grew 5.2% year-on-year to SGD193.0 million, driven by higher post-paid and fixed services revenues, which increased 5.7% and 27.4% to SGD132.6 million and SGD36.7 million, respectively. EBITDA increased by 1.4% y-o-y to SGD78.4 million, with an EBITDA margin of 40.6% (2Q17: 42.1%), and net profits increased 1.5% to SGD36.2 million. 2Q18 mobile service revenue improved 3.8% y-o-y to SGD146.0 million, with mobile contributing 64.4% of total service revenue. At the end of the period under review, M1 reported a total of 1.964 million mobile customers, after losing 152,000 pre-paid users in the past twelve months, down to a total of 625,000. However, the cellco added 71,000 net new post-paid customers during the past year for a total of 1.338 million customers. Meanwhile, revenues derived from fixed services continued to post strong growth across both the corporate and residential segments. M1 said its fibre customer base grew 6,000 quarter-on-quarter and 24,000 y-o-y to 200,000 at end-June 2018, with fixed revenue accounting for 19.0% of second-quarter service revenue, compared to 15.7% in the year-ago quarter. Q2 fixed and mobile CAPEX was SGD28.0 million, up 2.8% y-o-y.

Singapore, Axiata, M1

GlobalComms Database

Want more? Peruse the GlobalComms Database—the most complete source of intel about mobile, fixed broadband, and fixed voice markets.


TeleGeography is the definitive source for telecom news, numbers, and analysis. Explore the full research catalog.