Singtel plans up to $4.5b IPO for NetLink Trust: Sources

Singapore Telecommunications plans to list its broadband unit NetLink Trust on the local bourse in a deal that could raise about US$2 billion.
Singapore Telecommunications plans to list its broadband unit NetLink Trust on the local bourse in a deal that could raise about US$2 billion.PHOTO: ST FILE

SINGAPORE (REUTERS) - Singapore Telecommunications plans to list its broadband unit NetLink Trust on the local bourse in a deal that could raise about US$2 billion, slashing its stake by more than 75 per cent, sources close to the matter said on Thursday (May 12).

One source said Southeast Asia's largest telco is expected to appoint banks by the end of this year and the initial public offering of NetLink Trust could be launched in the second half of 2017.

Singtel, whose largest shareholder is state investor Temasek Holdings, was given an April 2018 deadline by regulator Infocomm Development Authority to reduce its stake in NetLink Trust, which provides high-speed broadband network.

The sources, who declined to be identified because the listing discussions are being kept private, said Singtel has been mulling a NetLink Trust IPO for years. But they said the company had yet to finalise valuations, set a time frame or appoint banks for the deal.

"We do have a deadline that was given by Infocomm Development Authority that's by April 2018, we will work towards that timeline," Group CEO Chua Sock Koong said during an earnings briefing earlier on Thursday, declining to give further detail.

The company did not immediately comment on the latest information about the deal.

The Wall Street Journal had reported on Wednesday plans about the potential NetLink IPO.

In a research note last month, Nomura said the enterprise value of NetLink could be between S$4 billion and S$4.5 billion, adding that it was likely to be listed by next year.

Earlier on Thursday, Singtel reported a flat fourth-quarter net profit of S$946 million.