Singtel associate AIS to acquire Triple T Broadband, fund for 32.42 billion baht

SINGTEL’s Thailand-based associate, Advanced Info Service (AIS), is acquiring two broadband entities for 32.42 billion baht (S$1.27 billion), according to a Monday (Jul 4) bourse filing.

For a consideration of 19.5 billion baht, AIS will acquire approximately 7.53 billion shares representing 99.87 per cent of total paid-up shares of Triple T Broadband from Jasmine International subsidiary Acumen Company Limited, via AIS’ 99.99 per cent-held subsidiary Advanced Wireless Network.

It will also acquire a 19 per cent stake equivalent to 1.52 billion units of Jasmine Broadband Internet Infrastructure Fund for 12.92 billion baht, valued at 8.50 baht per unit.

AIS plans to fund the acquisition with debt, given its sufficient debt headroom. It intends to maintain its dividend policy of a 70 per cent-minimum payout. The transaction is considered an asset acquisition with a total value equivalent to 38.7 per cent of the net tangible asset, based on AIS’s latest consolidated financial statement as at Mar 31, 2022, it added.

Previously on Friday, Maybank had upgraded its rating for AIS to “buy” with a 230 baht target price on expectations of the acquisitions. The Singtel associate has been in talks to potentially acquire Triple T Broadband since Q4 of 2021, said Maybank analyst Wasu Mattanapotchanart. 

The potential total return (price upside and yield) of 22 per cent supports and represents a significant upside to the 230 baht target price, he said, adding in his report that it is Maybank’s top sector pick.

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The acquisitions “would lead to substantial fixed broadband market share gain without significant impacts on NPV (net present value) and FY23 to FY24E core net profits,” he said.

AIS said in its Monday filing that the share purchase and acquisition of investment units are expected to be completed within the first quarter of 2023.

Singtel shares were trading at S$2.57, up S$0.02 or 0.8 per cent as at the midday trading break.