Axiata CEO eyes bigger stake in M1

Axiata is M1's biggest shareholder, with a 28.5 per cent stake. Mr Jamaludin (above) said it would be good for Axiata to raise its stake and that if the price is right, the company will seriously consider it.
Axiata is M1's biggest shareholder, with a 28.5 per cent stake. Mr Jamaludin said it would be good for Axiata to raise its stake and that if the price is right, the company will seriously consider it.PHOTO: ST FILE
Axiata is M1's biggest shareholder, with a 28.5 per cent stake. Mr Jamaludin (above) said it would be good for Axiata to raise its stake and that if the price is right, the company will seriously consider it.
Axiata is M1's biggest shareholder, with a 28.5 per cent stake. Mr Jamaludin (above) said it would be good for Axiata to raise its stake and that if the price is right, the company will seriously consider it.PHOTO: BLOOMBERG

No talks under way, but move will build on firm's presence in South and South-east Asia

KUALA LUMPUR • Axiata Group chief executive officer Jamaludin Ibrahim has signalled that Malaysia's biggest mobile-phone operator would be interested in raising its stake in M1 as part of plans to turn the company into a bigger regional carrier.

"Strategically, it will be good for us to increase the stake," Mr Jamaludin, 57, said in an interview last week, though he added that no negotiations were under way.

"If the price is right, we will seriously consider it."

Increasing its stake in M1 would build on Axiata's presence in South and South-east Asia, where it already controls operators in Indonesia, Sri Lanka, Bangladesh and Cambodia.

Still, Singapore is facing the prospect of mounting competition as the Government is seeking to award the nation's fourth licence to run a mobile-phone carrier.

M1 shares rose as much as 1.2 per cent to $2.54 in Singapore trading yesterday, before closing at $2.53. Axiata climbed as much as 0.7 per cent in Kuala Lumpur.

Axiata is M1's biggest shareholder, with a 28.5 per cent stake, followed by the 19.2 per cent held by Temasek Holdings' Keppel Corp, according to data compiled by Bloomberg.

People familiar with the matter said earlier this year that Temasek was weighing the possibility of Keppel selling its stake in M1.

For now, Mr Jamaludin said he's satisfied with Axiata's current holdings and isn't planning any major mergers and acquisitions. "Realistically, even if I want to go into another country, the opportunity is not there or it doesn't make sense."

He singled out India as an example. Axiata has no plan to raise or cut the company's 20 per cent stake in Idea Cellular, the nation's third-largest wireless carrier, as expansion in the country would require "huge" investments, Mr Jamaludin said. That's why they need partners like the Birla family, which controls Idea, he said.

In regard to Singapore's plan to have a fourth wireless carrier, the Axiata CEO said that would result in "one too many" players in that market, saying most countries can afford to have three operators so there's enough competition.

With plans to build Axiata into a "digital generation" company in the next five years, Mr Jamaludin said he is looking to expand the number of telecom towers in Asean and South Asia to 26,000 from 16,000 within three years and to eventually file for an initial public offering of the firm's assets.

Axiata will probably post RM2.03 billion (S$674.1 million) in net income for 2016 and RM 2.31 billion in 2017, according to the average analyst estimates.

BLOOMBERG

A version of this article appeared in the print edition of The Straits Times on September 06, 2016, with the headline 'Axiata CEO eyes bigger stake in M1'. Print Edition | Subscribe