Singapore: Singapore Telecommunications Ltd, the city-state’s biggest phone company, plans to spend about $2 billion to invest in Thailand’s Intouch Holdings Pcl and raise its stake in India’s Bharti Telecom Ltd, according to people with knowledge of the matter.
The planned investment, likely to be funded in cash, is aimed at boosting Singtel’s market share in the two markets, the people said, asking not to be named because the information is not yet public. Singtel also plans to issue new stock to its biggest shareholder Temasek Holdings Pte, which will boost the Singapore state-owned investment firm’s stake in the phone company to about 55% from 51%, one of the people said.
The investment would give Singtel a bigger foothold in India and Thailand by investing in the parent companies of the largest mobile phone operators in both markets.
Following media reports that it’s planning to buy part of Temasek’s stake in Intouch, Singtel said Wednesday that it regularly explores and reviews business opportunities. Fitch Ratings said on the same day that the telecom provider’s A+ credit rating would be at risk of being downgraded for the first time if Singtel buys the Intouch stake using debt since it would further weaken its net leverage.
Singtel and Temasek officials declined to comment on ”market speculation.” Officials at Intouch and Bharti declined to comment.
Singtel shares have risen 15% this year, compared with the 1.4% drop in the Singapore benchmark Straits Times Index. Bloomberg
Jonathan Burgos, Siddharth Philip and Tony Jordan contributed to this story.