Singtel weighing options for Australia Optus fibre assets, say sources

Singtel shares jumped as much as 3.4 per cent on Jan 11, their biggest intraday gain in five months. ST PHOTO: LIM YAOHUI

HONG KONG (BLOOMBERG) - Singtel is considering options including a potential stake sale in the fibre assets of its Australian subsidiary Singtel Optus, people familiar with the matter said, a deal that would follow last year's disposal of its mobile phone towers unit.

Singtel has held talks with potential advisers to prepare for a strategic review of the Australian fibre business, the people said, asking not to be identified because the information is private.

Options for the assets, which could be worth a few billion dollars, include a potential stake sale, partnership with an investor or a sale and lease back, the people said. Deliberations are preliminary and there is no certainty that the review will lead to a transaction, they added.

In a statement on Tuesday (Jan 11), Singtel said it regularly reviews its options to optimise its assets, adding that there is no assurance any transaction will occur.

Singtel shares jumped as much as 4.7 per cent on Tuesday, their biggest intraday gain in almost nine months.

A deal would help Singtel raise cash and boost growth amid increasing investor demand for digital infrastructure businesses, the people said.

In October, the company sold a majority stake in the mobile phone towers unit of Optus to pension manager AustralianSuper for about A$1.9 billion (S$1.85 billion).

The telco, which offers mobile, broadband and TV services as well as business-oriented solutions for companies, has a presence across Asia, Australia and Africa. In the half year ended Sept 30, 2021, Singtel's earnings before interest, tax, depreciation and amortisation (Ebitda) rose 1 per cent to $1.93 billion, while revenue grew 3 per cent to $7.65 billion. In Australia, Optus reported that Ebitda climbed 5 per cent, boosted by its mobile business.

Under a strategic review kicked off by group chief executive officer Yuen Kuan Moon in May last year, the company has been sharpening its focus on unlocking value in its infrastructure assets and bolstering its data centre platform.

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