KUALA LUMPUR, April 20: Axiata Group Bhd’s indirect subsidiary ISOC edotco Towers Inc (edotco Philippines) is acquiring 2,973 telecommunication towers and related assets in the Philippines from PLDT Group for RM3.42 billion.
Axiata said edotco Philippines, which is wholly owned by its 63 per cent-owned subsidiary edotco Group Sdn Bhd, yesterday inked the agreement for the asset purchase with PLDT Group’s units Smart Communications Inc and Digitel Mobile Philippines Inc (DMPI).
“Post-transaction, edotco Philippines will own and operate approximately 3,100 towers, hence becoming the largest independent tower company in the Philippines,” it said in a filing with Bursa Malaysia.
Axiata requested a trading halt of its shares and warrants between 9am and 10am today in conjunction with the announcement.
In a media statement, edotco Group chief executive officer Adlan Tajudin said this transaction presents a highly strategic acquisition for edotco as it diversifies and strengthens the group’s pan-Asian platform with exposure to a nascent, high-growth market with strong governmental support.
“With an established platform in the Philippines, edotco can play an instrumental role in developing the nation’s digital economy infrastructure while accelerating its organic and inorganic growth strategy,” he said.
Axiata said the transaction will be funded through a combination of both internally generated funds and external funding.
It said the proposed acquisition of PLDT’s tower assets will reduce edotco’s exposure to Axiata operating companies from 56 per cent to 48 per cent with increased portfolio concentration towards emerging markets from frontier footprint.
“Barring any unforeseen circumstances and subject to all approvals being obtained, the proposed acquisition of PLDT tower assets is expected to be completed by Dec 31, 2022.
“Concurrent with the execution of the sale and purchase agreement, Smart Communications has also entered into a master service agreement with edotco Philippines on the lease back of the transferred assets (proposed lease back transaction),” it added.
Axiata said in addition to the proposed lease back transaction, edotco Philippines has also been granted the commitment to build and develop 750 build-to-suit sites for leasing to Smart Communications in the future.
PLDT Group, which is listed on the Philippine Stock Exchange, is the Philippines’ largest fully integrated telecommunication company. Its American depositary shares are listed on the New York Stock Exchange.
At 11.15am, Axiata rose six sen to RM3.66, with 534,100 shares changing hands. – TVS
