SingTel may sell assets in Indonesia<\/p>\n
Bryan Lee, Asia News Network, The Straits Times\/Singapore<\/p>\n
SingTel is in talks to sell its stake in a fixed phone line
\nnetwork in eastern Indonesia to Telkom, the country's biggest
\ntelecoms company, for an undisclosed sum.<\/p>\n
If it goes ahead, the sale is expected to return a profit to
\nthe Singapore telco from the US$47 million it has invested in the
\nnetwork, industry watchers said, although no specific figures
\nwere suggested.<\/p>\n
In 1995, SingTel took up a 40 percent stake in Bukaka SingTel,
\nthe joint venture company which operates the network. Its
\nIndonesian partner Bukaka Telekomindo owns the rest of the firm.<\/p>\n
Garuda Sugardo, Telkom deputy president director, told wire
\nagencies recently that Bukaka SingTel has approached Telkom to
\nsell the assets to the telco.<\/p>\n
\"It is a good offer. We want to end the KSO contract as soon
\nas possible so that we will be free to develop our network in
\neastern Indonesia,\" he told AFX Asia.<\/p>\n
KSO is an Indonesian abbreviation referring to a 15-year
\nrevenue sharing deal under which Bukaka SingTel would build and
\noperate a network in the area for Telkom.<\/p>\n
The contract was awarded, along with four other similar deals
\nto various telcos, 10 years ago as part of government efforts to
\naccelerate telecoms development in the country.<\/p>\n
Under the agreements, telcos, including Telstra and France
\nTelecom, would build and operate fixed-line networks in parts of
\nIndonesia for 15 years before transferring them to Telkom.<\/p>\n
Since then, Telkom has canceled and bought out the four other
\npartners involved in the scheme.<\/p>\n
For the Bukaka deal, Sugardo said Telkom has appointed ABN
\nAmro as its adviser, while Bukaka SingTel is seeking advice from
\nUBS.<\/p>\n
SingTel declined to comment on the possible sale on Tuesday.<\/p>\n
Bukaka was one of SingTel's first regional forays back in 1995
\nand was lauded as an early success of the telco's overseas
\nexpansion.<\/p>\n
Serving about 841,000 customers in Bali, Lombok, Sulawesi,
\nMaluku and Papua, it has however been outshone by SingTel's later
\ninvestments in the region's mobile operators.<\/p>\n
These include Indonesia's Telkomsel, in which SingTel owns a
\n35 percent stake, which boasts more than 20 million customers.<\/p>",
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