SPH, Keppel get majority control of M1 as Axiata bows out

18 Feb 2019

Konnectivity, a company jointly owned by Singapore Press Holdings (SPH) and Singaporean conglomerate Keppel Corporation, has secured majority control of city-state fixed and mobile operator M1 Limited (M1), with the announcement that Axiata Group (via wholly owned subsidiary Axiata Investments [Singapore]) has accepted a voluntary conditional general cash offer for the group’s entire 28.6% stake in M1 for MYR1.65 billion (USD404.5 million). In a press release, SPH confirmed that ‘Konnectivity has received valid acceptances that result in it and its concert parties holding 75.5% of the maximum potential issued share capital of M1’. Axiata’s decision to walk away from M1 ends a relationship that began back in 2005, since when the investment has yielded healthy dividends of 7% over the years, and comes at a time when the industry faces short-term challenges in the shape of upcoming new entrant TPG.

In a statement, the Malaysian group confirmed: ‘Axiata has been consistent in its view that the share price over the last year does not reflect the intrinsic value of the company’s long-term future. Nevertheless, Axiata has made the decision to accept the offer due to the need for capital reallocation and new priorities in line with its vision to be the next generation digital champion by 2022 and the investments required to achieve that. The group also prefers not to be a minority investor in a potentially privatised company, making the investment illiquid.’

Singapore, Axiata, M1