Singtel’s Thai associate AIS buys broadband businesses for $1.27 billion

BANGKOK (BLOOMBERG) –  Advanced Info Service (AIS), Singtel’s Thailand-based associate and the country’s biggest mobile phone operator, plans to expand its network by acquiring Triple T Broadband and an infrastructure fund for a total of 32.4 billion baht (S$1.27 billion).

AIS will buy Internet provider Triple T from Jasmine International for 19.5 billion baht, chief financial officer Tee Seeumpornroj said in an exchange filing. It will also acquire 1.52 billion units, or a 19 per cent stake, in Jasmine Broadband Internet Infrastructure Fund for 12.9 billion baht. At 8.5 baht a unit, that is a 10.5 per cent discount to the fund’s closing price on Friday (July 1).

“This acquisition will enhance consumer access to broader and better quality of service by improving broadband inclusion in new areas targeting the up-country and non-city areas,” Mr Tee said. “This aligns with our business direction to grow the broadband business and effectively develop the nation’s fibre infrastructure.”

Singtel shares were trading up 0.4 per cent at $2.56 at 1.42pm on Monday. Shares of AIS surged 1.8 per cent to 201 baht.

“Advanced Info is the biggest beneficiary from this deal as the acquisition cost is much lower than we previously expected,” said Maybank Securities analyst Wasu Mattanapotchanart.

“The cheap price and additional subscribers will benefit Advanced Info’s operations and outlook significantly. In contrast, Jasmine has a negative outlook from this deal because it is selling almost all of its businesses at a cheap price.”

AIS said it will finance the acquisitions with borrowings, given its “sufficient debt headroom”. The company pledged to maintain a dividend payout of at least 70 per cent of its net income.

The move comes as Norway’s Telenor bids to merge its Thai telecommunications unit with True Corp and potentially topple AIS as the country’s biggest mobile operator.

AIS’ backers include Thai billionaire Sarath Ratanavadi, while True is backed by billionaire Dhanin Chearavanont’s Charoen Pokphand Group and China Mobile.

AIS will seek regulatory approvals before entering the formal contract and it expects to complete the acquisitions in the first quarter of 2023, it said in a separate statement.