19-08-2008: TMI appoints underwriters for XL share sale
by Sharmila Ganapathy
KUALA LUMPUR: TM International Bhd (TMI) has appointed underwriters for its planned sale of up to 10% of shares in its Indonesian mobile carrier PT Excelcommindo Pratama Tbk (XL), according to an Indonesian daily. Last Friday, The Jakarta Post reported that XL had appointed JP Morgan, Merrill Lynch and Mandiri Sekuritas as underwriters for the XL share sale. Citing a source close to the deal, the Indonesian daily said the underwriters would help XL sell at least 10% of its shares to the public in the fourth quarter in a secondary offering. The daily quoted XL president director Hasnul Suhaimi saying last Thursday that XL aimed to sell a minimum of 10% of its shares. XL is also looking to sell 7,000 units of its base transmission stations (BTS), where it has already short-listed buyers.
The company was still in negotiations on pricing and requirements, The Jakarta Post said, quoting Hasnul. Hasnul also said that the company would in future mostly lease base stations and build new ones in small numbers.
Hasnul further said XL expected to secure seven trillion Indonesian rupiah (RM2.54 billion) cash from selling the base stations, to be used for investment and debt refinancing. The company had also set aside three trillion rupiah to build or least 3000 base stations within the next two years to expand its operations.
In a report dated Aug 4, OSK Research highlighted that XL recognised 87 billion rupiah in tower revenues for the first half of 2008. “Based on the 7,000 towers available for lease, there is an estimated 2.7 trillion rupiah in potential lease revenues going forward,” the research house said in its report.
According to OSK, XL has the second highest number of BTS after PT Telekomunikasi Indonesia. XL had 13,408 BTS as at end Q208.
XL’s largest shareholder is currently TMI with an 83.79% stake, a further 15.97% is held by Emirates Telecommunication (Etisalat). Based on last Friday’s closing share price of 2,400 rupiah, TMI’s stake in XL is worth RM5.13 billion, while Etisalat’s stake is worth RM976.92 million based on last Friday’s closing price.
Its thin public shareholding spread leaves XL little option than a secondary offering to boost its trading on the Indonesian bourse. In 2Q08, XL added 4.5 million net subscribers, boosting total subscriber base by more than 24% in three months.
Indonesia is currently the fastest-growing mobile market after India and China, with annual projected net additions over between 25 million and 30 million over the next three years, OSK Research said.
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