Axiata And PT XL Axiata To Jointly Acquire 66% Stake In Broadband Provider PT Link Net For RM2.55 Billion

Axiata Group Berhad and PT XL Axiata Tbk have proposed to jointly acquire an aggregate 66.03% equity interest in PT Link Net Tbk from Asia Link Dewa Pte. Ltd. for RM2.55 billion.

Under the terms of the SPA, Axiata Investments Sdn Bhd (Indonesia), an indirect wholly-owned subsidiary of Axiata, and XL Axiata will acquire 46.03% and 20.00% respectively from the combined equity interest of 66.03% in Link Net held by ALD and FM.

The Proposed Acquisition is expected to be completed in the third quarter of 2022 and will be subjected to customary completion conditions, including regulatory and shareholder approvals. Axiata added that the fundings for the exercise will be sourced internally and via bank borrowings, which it will announce at a later period.

Link Net which commenced its commercial operations in 2000 is a high-speed broadband and cable TV provider in Indonesia, reaching 2.8 million homes across 23 cities with a subscriber base of approximately 860,000. Based on independent market research, Indonesia is one of the most attractive fixed broadband markets globally, significantly underpenetrated at 13.4% in terms of household penetration. It is also one of the fastest-growing broadband markets in the world with fixed connections poised for significant expansion at a compound annual growth rate of approximately 14.4%.

Furthermore, household penetration is expected to increase to 27.5% by 2026, driven by a growing addressable market, escalating data use, and the robust growth in Indonesia’s disposable income per capita.

Axiata sees the acquisition as a significant synergy for Link Net and XL Axiata whereby both through their combined positions in wireless communication services, sharing of backbone and transmission networks and extensive relationships can form a position in the market.

Axiata’s President & Group CEO, Dato’ Izzaddin Idris said, “In addition to doubling down on a high-growth segment in one of our key markets, our investment into Link Net is aligned with Axiata’s aspiration to support digital inclusion as Asian societies and businesses accelerate digitally.”

XL Axiata’s President Director & CEO, Dian Siswarini said, “The synergies that will be unlocked through collaborations with Link Net make this an attractive proposition gave the opportunity to combine strengths in mobile connectivity, fixed broadband, and content.”

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