Major Indonesian carrier Indosat Tbk. last week announced the signing of a sale and leaseback agreement with PT EPID Menara AssetCo for more than 4,200 telecommunications towers.
PT EPID Menara Assetco is an Indonesian subsidiary of Edge Point Singapore, which is wholly owned by Digital Colony. Indosat Ooredoo has agreed to sell the towers in a transaction valued at US$750 million, including a supplementary offer, making it, according to analysts, one of the largest deals of its kind in Asia.
The tower sale was designed to unlock capital to build on Indosat Ooredoo’s growth momentum through further improvements to its network performance and the launch of new digital solutions. The sale is part of Indosat Ooredoo’s stated turnaround strategy, which has refocused the business on digital products and services and sought to create optimal value from its infrastructure.
President Director and Chief Executive Officer of Indosat Ooredoo, Ahmad Al-Neama, said: “The deal marks the third and final sale of assets from Indosat Ooredoo’s high-quality tower portfolio that moves us towards a more asset-light model and greater focus on delivering outstanding mobile digital services to our customer. I would like to thank the Government of Indonesia for creating a policy environment that has enabled the telecoms industry to thrive and attract high-quality investors such as Edge Point Indonesia. Increasing investment into the sector will ultimately benefit customers and the Indonesian people.”
Edge Point Indonesia was declared the winning bidder of a competitive tender process conducted by Indosat Ooredoo. The transaction is expected to close in Q2 2021 subject to customary conditions, including shareholder approval by Indosat Ooredoo at a recently held EGM. Indosat Ooredoo will lease back space on the towers for 10 years to meet its ongoing requirements.
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