Simba Telecom—a unit of billionaire David Teoh’s Australia-listed Tuas Ltd.—is buying M1 in a deal valuing the Singapore-based mobile carrier at S$1.4 billion ($1.1 billion).
Keppel has agreed to sell its 83.9% stake in M1 to Singapore-based mobile operator Simba for cash proceeds of close to S$1 billion, the company said in a statement on Monday. Keppel will retain M1’s Information and Communications Technology businesses, which complements the conglomerate’s connectivity operations such as data centers and subsea cables.
While the transaction will result in a S$222 million loss for state-linked Keppel, the deal “crystalizes value from Keppel’s investment in M1 over the years,” the company said. The sale of M1, which Keppel founded in 1994 to compete with telecom giant Singtel, is expected to be completed in a few months subject to regulatory approvals.
The divestment unlocks value for Keppel, which plans to use the cash proceeds to fund growth opportunities, lower debt levels and reward shareholders. Keppel said it has identified a portfolio of non-core assets (worth more than S$14 billion) that it plans to sell.
“M1 and Simba are a highly synergistic combination—together, they can scale more efficiently, optimize infrastructure and accelerate 5G and digital investments,” Loh Chin Hua, CEO of Keppel, said in the statement.
Simba’s parent Tuas reported a first-ever net profit of S$3 million in its first half ended January as revenue jumped 34% to S$73.2 million. Tuas expects to remain profitable for the rest of the fiscal year. Simba had 1.2 million mobile subscribers and over 14,000 broadband customers as of January.
Tuas, which was spun off as a separate listed entity after its parent TPG Telecom merged with Vodafone Australia in March 2020. Teoh, 69, an Australian citizen of Malaysian descent, is the founder and former executive chairman of TPG Telecom. He has a real-time net worth of $2.1 billion, according to Forbes.
This article was originally published on forbes.com and all figures are in USD.
Look back on the week that was with hand-picked articles from Australia and around the world. Sign up to the Forbes Australia newsletter here or become a member here.
