Singapore moves - SingTel purchases shares in Telekom Malaysia via Temasek Holdings
Some time ago, we reported that Temasek Holdings of Singapore was interested in a stake in a smaller Malaysian bank. March 2, 2004 was the day, when the holdings group acquired a 5% stake in Telekom Malaysia from Khazanah Nasional, the Malaysian government's investment arm. Temasek Holdings also has shares in Singapore Telecommunications or in short, SingTel, and here, the story becomes interesting.
All kinds or arguments have been put forward for the acquisition:
A sign that the relations between Malaysia and Singapore are finally warming, after they cooled down dramatically over certain, other issues;
An attempt to up the momentum in Telekom Malaysia. For a while, the company was the market leader in Malaysia, after their acquisition of Celcom (which was followed by their main competitor Maxis, with TimeDotCom). However, those gains have been lost again and Maxis Communications leads once again;
With the Ringgit being undervalued, it is a less cost intensive move by Temasek
All those are valid and solid reasons and there are probably more. However, what we haven't read about yet is that the entry of SingTel into the Malaysian market is also another piece of their strategy to position themselves as the dominant regional player - something, that looks increasingly successful. I remember how frustrated they were when their bid to purchase a stake in TimeDotCom in 2000 was rejected by the former Malaysian Prime Minister. Singtel bought Optus in Australia back in 2001- which now is a crown jewel in their total portfolio. Besides Optus, SingTel has shares in Telkomsel in Indonesia, Advanced Info Services (AIS) in Thailand, Philippines's Globe Telecom and Bharti Televenture in India. Can you see how it all falls together? Malaysia was the missing piece, something that has been added now!
And the company is solid. Third quarter 2003 profits rose by 188% - mainly due to the Optus acquisition, where the integration was smoother than expected, but more is surely to come.
(By Asia Business Consulting)
All kinds or arguments have been put forward for the acquisition:
A sign that the relations between Malaysia and Singapore are finally warming, after they cooled down dramatically over certain, other issues;
An attempt to up the momentum in Telekom Malaysia. For a while, the company was the market leader in Malaysia, after their acquisition of Celcom (which was followed by their main competitor Maxis, with TimeDotCom). However, those gains have been lost again and Maxis Communications leads once again;
With the Ringgit being undervalued, it is a less cost intensive move by Temasek
All those are valid and solid reasons and there are probably more. However, what we haven't read about yet is that the entry of SingTel into the Malaysian market is also another piece of their strategy to position themselves as the dominant regional player - something, that looks increasingly successful. I remember how frustrated they were when their bid to purchase a stake in TimeDotCom in 2000 was rejected by the former Malaysian Prime Minister. Singtel bought Optus in Australia back in 2001- which now is a crown jewel in their total portfolio. Besides Optus, SingTel has shares in Telkomsel in Indonesia, Advanced Info Services (AIS) in Thailand, Philippines's Globe Telecom and Bharti Televenture in India. Can you see how it all falls together? Malaysia was the missing piece, something that has been added now!
And the company is solid. Third quarter 2003 profits rose by 188% - mainly due to the Optus acquisition, where the integration was smoother than expected, but more is surely to come.
(By Asia Business Consulting)
posted by Andreas @ 2:40 am
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