Two of Malaysia’s mobile network operators (MNOs) will not take stakes in Digital Nasional Berhad (DNB), the company that has been tasked with rolling out the country’s sole 5G network. According to Reuters, which cites three people familiar with the matter, their decision threatens to disrupt the Malaysian government’s 5G plans and negotiations with other cellcos, with an unnamed source cited as saying: ‘[The parties] will have to try and restructure the deal.’
As previously reported by CommsUpdate, earlier this month the nation’s six major MNOs – Celcom, Digi Telecommunications, Maxis, Telekom Malaysia, U Mobile and YTL – agreed to take a combined 70% equity stake in DNB. Prior to that, a counter proposal had been made by Celcom, Digi, Maxis and U Mobile for that quartet to take a combined majority stake in DNB, but such plans were knocked back by the government.
Now, although Maxis and U Mobile have changed their minds – no longer reportedly seeing any benefit in becoming a minority shareholder in DNB – sources note that the pair have told the government that they wish to remain in talks regarding access to DNB’s 5G infrastructure.
Meanwhile, although DNB had declined to comment on the matter it confirmed to local media that two carriers had opted not to proceed with stake purchases, though it did not confirm the identities of the pair. Meanwhile, DNB also confirmed that the transaction documents underpinning the stake sale would now need to be adjusted for the equity subscription by four carriers, instead of the original six, noting that this will would require further internal approvals from the companies that remain involved in the process. ‘The four mobile network operators remain interested, and it is envisaged that the equity participation process will progress to completion,’ DNB was cited as saying.