Axiata's subsidiary proposes to acquire Touch Mindscape for RM1.7 bln

KUALA LUMPUR, Nov 30 -- Axiata Group Bhd’s indirect subsidiary, edotco Malaysia Sdn Bhd, has entered into a share sale agreement with Touch Group Holdings Sdn Bhd (TGHSB) for the acquisition of the entire issued and paid-up share capital of Touch Mindscape Sdn Bhd (TMs).

The acquisition comprised 14.1 million ordinary shares and 10.9 million preference shares held by TGHSB for a total purchase consideration of RM1.7 billion.

TGHSB holds the entire sale shares in TMs, a private limited company incorporated in Malaysia, principally involved in construction and leasing of telecommunication towers to mobile network operators.

edotco Malaysia is a wholly-owned subsidiary of edotco Group Sdn Bhd, which in turn is a 63.0 per cent-owned subsidiary of Axiata.

In a filing to Bursa Malaysia today, Axiata said the proposed acquisition of TMs Group will be funded by a combination of both internally generated funds and external funding.

“Save for the purchase price and any liabilities arising as a consequence of consolidating TMs Group as a subsidiary of Axiata, Axiata will not be assuming any liabilities pursuant to the proposed acquisition of TMs Group. No financial commitments are also required by Axiata to finance the operations,” it shared.

Axiata said among the rationale for the proposed acquisition include the scarcity of scale portfolios in Malaysia for inorganic growth as edotco Malaysia owns and operates approximately 4,700 towers and manages a further 12,000 towers.

Besides that, it would also help the group cement home market leadership as this transaction allows edotco Malaysia to increase its tower market share from 21 per cent to 25 per cent as well as allowing the group to secure a strategic fiber network which is crucial in further future proofing edotco Malaysia’s tower infrastructure portfolio.

Moving forward, Axiata said upon the completion of the proposed acquisition of TMs Group, it expected to further strengthen its position within the tower infrastructure industry in Malaysia while also position itself better to capitalise on the growth in fiber infrastructure demand.

“Based on the potential prospects of the telecommunications market in Malaysia, the Board is of the opinion that the exercise is expected to contribute positively to the future earnings of Axiata and support its long-term strategies and objectives, hence enhancing shareholder value in the future,” it added.

-- BERNAMA