KUALA LUMPUR: AXIATA Group Bhd has raised US$600 million (RM2.7 billion) from its record maiden private placement of a substantial stake in edotco Group.
Axiata signed definitive agreements of the private placement with Innovation Network Corp of Japan (INCJ) and Khazanah Nasional Bhd yesterday.
Public-private investment firm INCJ and Khazanah had subscribed for US$400 million and US$200 million, respectively, of primary and secondary edotco shares, said Axiata in a statement yesterday.
“The maximum committed placement of US$400 million from INCJ and US$200 million from Khazanah will result in the new investors collectively owning 34.1 per cent of edotco, with Axiata remaining the majority shareholder at 65.9 per cent,” the company added.
This values edotco’s final portfolio at equity value of close to US$1.5 billion and an enterprise value to financial year 2016 earnings before interest, tax, depreciation and amortisation multiple of 12.5 times, which Axiata said, is comparable to regional peers.
The final portfolio takes into account the potential injection of tower assets in Cambodia and Sri Lanka at a later date with a resultant increase in Axiata’s shareholding in edotco.
edotco is an integrated telecommunications infrastructure services company that provides end-to-end solutions in the tower services sector from tower leasing, co-locations, build-to-suit, energy, transmission and operations and maintenance.
“Our lead investors and new shareholders, INCJ and Khazanah, are both long-term investors which will provide strategic value-add to edotco’s growth strategy, open doors to further strategic collaborations, as well as enhance and diversify our shareholder base,” said edotco chief executive officer Suresh Sidhu in the statement.
“We will deploy the proceeds of the primary placement with the aim of accelerating our growth trajectory, thereby growing shareholder value further.”
edotco chairman Datuk Azzat Kamaludin said the company’s strong business fundamentals coupled with exceptional long-term prospects and experienced management team had played a role in attracting high quality foreign and local investors such as INCJ and Khazanah.
“Significant portfolio expansion as well as strong improvements in tenancies have led to robust business growth and as a result, edotco has been able to achieve a comparatively strong valuation in this placement exercise,” said Axiata group president and chief executive officer Tan Sri Jamaludin Ibrahim.
“We are determined to make edotco a world-class business and one of the world’s largest independent tower companies by 2020,” he added.