Singapore Telecommunications (Singtel), via its wholly-owned subsidiary Singtel Global Investment, has acquired some 121.16 million shares in Intouch Holdings for $330 million.
The consideration of the shares represents a 5% discount to the volume weighted average price (VWAP) of each Intouch share on the Stock Exchange of Thailand for the 20 Thai trading days before the acquisition. The consideration will be satisfied in cash.
The shares were acquired from Temasek’s Anderton Investments, bringing Singtel’s total stake in Intouch Holdings to 24.99% from 21.21% previously.
Singtel is one of Intouch’s two largest shareholders along with Gulf Energy, Thailand’s biggest power producer by market value.
Gulf Energy, which is controlled by billionaire Sarath Ratanavadi, was said to have offered to buy the remaining stake it doesn’t own in Intouch in April 2021.
According to a statement released by Singtel on June 16, the acquisition reinforces the telco's commitment to the Thai market which it has invested in for more than two decades.
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Through the acquisition of Intouch, which is the parent company of Advanced Info Services (AIS), Singtel will increase its economic interest in AIS. AIS is a regional associate of Singtel since 1999, and is Thailand’s largest mobile operator with over 45 million mobile customers. It has been seeing strong growth in its enterprise business with the surge in demand for cloud, data centre and ICT solutions.
Singtel Group CEO Yuen Kuan Moon says, "Intouch has been delivering good returns supported by consistently strong execution from AIS in one of the region’s most attractive markets. Our increased investment deepens our partnership with Intouch’s largest shareholder Gulf Energy, and is part of our strategy of actively recycling capital to invest for growth and shareholder returns. At the same time, it demonstrates our confidence in AIS’s potential to build on its position as the mobile operator of choice and become the leader in digital and enterprise services.”
As Temasek has a 52.47% stake in Singtel as at March 31 comprising a direct interest in 8.30 billion shares and a deemed interest in some 0.36 billion shares in Singtel, the acquisition constitutes an interested person transaction under SGX’s listing manual rules.
According to the e-Conomy SEA report in 2021 by Google, Temasek and Bain, Thailand’s digital economy is estimated to almost double in four years to US$56 billion ($77.86 billion) in 2025 from US$30 billion in 2021.
The country’s National Broadcasting and Telecommunications Commission has also announced its intention to boost telecommunications infrastructure and deploy 5G technology to create an ecosystem linking government agencies and private sectors as part of the Thailand 4.0 digital transformation initiative.
According to Singtel, AIS is well positioned to benefit from the rapid digital adoption among consumers and enterprises, and become the leader in digital life services covering mobile, fixed, enterprise and digital.
The transaction is expected to be completed by the end of June.
Shares in Singtel closed 2 cents lower or 0.79% down at $2.50 on June 15.
