Singtel gets two offers for Australian satellite business, say sources

HONG KONG, Aug 9 — Singapore Telecommunications (SingTel) has received at least two offers for its Australian satellite business in the final round of the bidding process, including one from US-listed Intelsat SA, sources familiar with the matter said.

SingTel, Southeast Asia’s largest telecom operator, has been seeking a sale of the satellite division of its Australian unit Optus since a strategic review of the asset in March.

It wants to use the sale proceeds in fast-growing emerging markets and set a reserve price of A$2 billion (RM6 billion) for the business.

Intelsat, the world’s biggest operator of satellite services, made their offer ahead of this week’s bid deadline, according to one of the two sources.

The second offer came from a consortium made up of Blackstone Group LP, TPG Capital and Malaysia’s MEASAT Global, the second source said.

However the offer was subject to further due diligence as the information provided was not deemed sufficient to arrive at a firm valuation for the Australian company, the source added.

Blackstone, TPG, MEASAT and SingTel did not respond to emails seeking comment. Intelsat declined to comment.

SingTel is still evaluating the two offers and has not made a final decision yet, said the sources, who declined to be named as the process was private.

SingTel, controlled by Singapore state investor Temasek Holdings, acquired the satellite arm when it bought Optus in 2001 for US$14 billion. Optus sells TV, telephony and broadband services to more than 2 million subscribers in Australia and New Zealand.

At least two bidders from a shortlist of six dropped out of the auction process in recent weeks, including France’s Eutelsat Communications, the sources said.

IPO option

SingTel hired Credit Suisse and Morgan Stanley to conduct a review of the satellite business and they are now running the sale.

The Singaporean company would fall back on the alternative option of an initial public offering (IPO) if the offers do not meet expectations, the sources said.

The consortium had requested information on the length of contracts related to customers of Optus’ satellites among other details to make a firm offer, according to one source, but had not received answers.

Paris-based Eutelsat dropped out of the process, a separate source with knowledge of the matter said, after it agreed to buy Mexico’s Satelites Mexicanos SA in July for an enterprise value of US$1.14 billion. Eutelsat declined to comment.

Another French firm, SES SA dropped out of the bidding earlier in July, according to other sources with knowledge of the matter. SES did not respond to requests for comment.

It was not immediately clear if the other shortlisted bidders, US buyouts firm Apollo Global Management and Japanese satellite company Sky Perfect JSAT Holdings Inc, had made final offers. — Reuters

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