KUALA LUMPUR, Jan 27 — Axiata Group Bhd and PT XL Axiata Tbk are jointly acquiring 66.03 per cent equity interest and will carry out a mandatory tender offer (MTO) for the remaining 33.97 per cent of PT Link Net Tbk shares for a total purchase sum of RM3.86 billion for a 100 per cent stake.
The parties today inked a conditional share purchase agreement (SPA) for the purpose, agreeing to acquire Link Net equity at 4,800 rupiah (RM1.40) per ordinary share from Asia Link Dewa Pte Ltd (ALD) and PT First Media Tbk (FM).
This translates to a value of about RM3.86 billion (13.21 trillion rupiah) for the entire equity interest in Link Net, they said in a joint statement today.
Under the terms of the SPA, Axiata Investments (Indonesia) Sdn Bhd, an indirect wholly-owned subsidiary of Axiata and XL Axiata will acquire 46.03 per cent and 20 per cent, respectively, from the combined equity interest of 66.03 per cent in Link Net held by ALD and FM for RM2.55 billion (8.72 trillion rupiah).
Axiata Investments Indonesia will then be obligated to undertake an MTO to acquire the remaining 33.97 per cent Link Net shares pursuant to regulatory requirements in Indonesia.
The proposed acquisition and proposed MTO are expected to be completed in the third quarter of 2022.
The group said the proposed acquisition is expected to create significant synergies for Link Net and XL Axiata through their combined positions in wireless communication services, sharing of backbone and transmission networks and extensive relationships with customers in Indonesia.
Coupled with XL Axiata’s enterprise offerings including mobile connections, Link Net will be well-positioned to capitalise on the growing enterprise market.
Additionally, Axiata will benefit from Link Net’s strong cash flow profile and consistent dividend payouts, as well as entrench its position as one of the leading digital players in the region, with increased exposure to high average revenue per user customers and the higher potential and faster-growing fixed broadband market.
“In addition to doubling down on a high growth segment in one of our key markets, our investment into Link Net is aligned with Axiata’s aspiration to support digital inclusion as Asian societies and businesses accelerate digitally,” Axiata president and group chief executive officer Datuk Izzaddin Idris said. “Both XL Axiata and Link Net are well placed to generate synergies through their combined positions in wireless communication services, extensive relationships with customers in Indonesia and strong strategic alignment.’’
XL Axiata president director and chief executive officer Dian Siswarini said XL Axiata is gearing up to realise its vision to become the leading converged operator in Indonesia.
“The synergies that will be unlocked through collaborations with Link Net make this an attractive proposition given the opportunity to combine strengths in mobile connectivity, fixed broadband and content,” Dian said.
Based on independent market research, Indonesia is seen as one of the most attractive fixed broadband markets globally, significantly underpenetrated at 13.4 per cent in terms of household penetration.
It is also one of the fastest growing broadband markets in the world with fixed connections poised for significant expansion at a compound annual growth rate of approximately 14.4 per cent.
Link Net commenced its commercial operations in 2000 and has since grown to be among the leading providers of high-speed broadband and cable TV in Indonesia, reaching 2.8 million homes across 23 cities with a subscriber base of approximately 860,000.
In the financial period ended Sept 30, 2021, Link Net’s revenue rose 9.8 per cent to 3.24 trillion (RM947 million) year-on-year. — Bernama
