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Singtel-linked Telkomsel sells 6,000 more telecom towers to Mitratel

Felicia Tan
Felicia Tan • 3 min read
Singtel-linked Telkomsel sells 6,000 more telecom towers to Mitratel
Telkomsel last sold 4,000 telecommunication towers to Mitratel for IDR6.2 trillion ($580 million) on Sept 2, 2021. Photo: Mitratel
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Singtel associate PT Telekomunikasi Selular (Telkomsel) is selling a further 6,000 telecommunication towers to PT Dayamitra Telekomunikasi (Mitratel) on Aug 2.

Singtel owns a 35% stake in Telkomsel, which is a leading mobile operator in Indonesia.

The agreement to divest the towers was made via the signing of a sale and purchase agreement (SPA) between Telkomsel and Mitratel in Jakarta on July 29.

The latest divestment now puts the number of Telkomsel’s telecommunication towers that have changed ownership to Mitratel at 16,050 units.

Telkomsel last sold 4,000 telecommunication towers to Mitratel for IDR6.2 trillion ($580 million) on Sept 2, 2021.

"With the agreement of the sale and purchase agreement for the transfer of ownership of 6,000 telecommunication towers to Mitratel, Telkomsel further strengthens the company's transformation efforts through the development of a company portfolio in the digital business that is more consistent, comprehensive and strengthens the company's commitment to providing more innovative services,” says Hendri Mulya Syam, president director of Telkomsel.

See also: Singtel denies report it is 'exploring options' over Australia unit

“Telkomsel, as the leading digital telecommunication company in Indonesia, also hopes to accelerate further the strengthening of an ideal corporate structure in ensuring the implementation of the three digital pillars that are being carried out, namely as a reliable provider of digital connectivity, digital platforms and digital services that are always relevant to the development of the digital ecosystem,” he adds. “[The diversity] will open up more value-added opportunities for the digital lifestyle ecosystem of the Indonesian people in a more inclusive manner.”

As part of the agreement, Mitratel will also deploying Telkomsel’s internet of things (IoT) and data analytics services to provide real time management of the towers and proactive optimization of power consumption.

According to Telkomsel, this partnership will contribute to reduction of carbon emission and footprint, demonstrating the group’s environmental, social and governance (ESG) initiatives.

See also: Singtel secures $535 mil five-year green loan, its first

In addition, the ongoing corporate action between both parties is also expected to strengthen the momentum of the two companies in ensuring the creation of asset management and expansion of business lines.

"This corporate action is one of Telkom group's efforts to strengthen its position in the telecommunications tower business to strengthen the company's competitive advantages and increase value creation for stakeholders," explains Budi Setyawan Wijaya, director of strategic portfolio of PT Telkom Indonesia (Persero) Tbk (Telkom).

"The ownership diversion of 6,000 telecommunication towers can be our main capital for market expansion and to support the acceleration of 5G implementation in Indonesia, increase Mitratel's production equipment, and strengthen Mitratel's position as the biggest tower provider in Indonesia and one of the largest in Southeast Asia,” says Mitratel CEO, Theodorus Ardi Hartoko.

“Along with the transaction, we also agreed to explore [the] tower ecosystem business with Telkomsel by utilising internet of things (IoT) to support service operation and business expansion that encompasses green energy service and other new ecosystem tower business,” he adds.

Shares in Singtel closed 1 cent lower or 0.38% down at $2.63 on Aug 2.

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