MALAYSIA, 17/07/2024 (Asia News Channels) - Maxis Bhd, the telecommunications company controlled by billionaire T. Ananda Krishnan, is exploring a potential acquisition of U Mobile Sdn Bhd to expand its operations in Malaysia, according to sources familiar with the situation.
Kuala Lumpur-listed Maxis has shown interest in U Mobile, though discussions are still in the early stages, said the sources, who requested anonymity due to the private nature of the information. Major shareholders of U Mobile include Malaysian businessman Vincent Tan and Singapore Technologies Telemedia Pte Ltd, backed by Temasek Holdings Pte Ltd.
Valuation could be a significant challenge, as U Mobile's owners are seeking over RM10 billion (US$2.1 billion) for the company, the sources said. There is no certainty that a deal will be finalized, they added.
In a message to Bloomberg News on Monday, Vincent Tan confirmed that U Mobile is rejecting the buyout offer from Maxis and is planning to proceed with an initial public offering (IPO) by the end of July. "We are rejecting Maxis’ offer," Tan wrote. "We are submitting for an IPO at the end of this month." U Mobile has been considering an IPO since 2021.
A representative for U Mobile declined to comment on market speculation, stating, "We are very focused on delivering more innovative 5G products and services to our customers and doing the prep work required to respond to the Applicant Information Package issued by the Malaysian government to participate in the tender of building the nation’s second 5G network."
Representatives for Maxis and ST Telemedia also declined to comment.
Founded in 2006, U Mobile is Malaysia’s youngest telecommunications company. According to its website, the company operates over 4,000 4G sites and has a network ready for 5G. U Mobile also offers services such as fintech and digital payments. Last month, the company signed an agreement for an undisclosed equity stake in state-owned Digital Nasional Bhd, which is developing 5G infrastructure in Malaysia.
Maxis shares have decreased by 9.4% this year, giving the company a market value of RM27.3 billion. Maxis serves over 13 million customers and maintains a fiber network spanning more than 22,000 kilometers, according to its annual report.
-- ASIA NEWS CHANNELS