JAKARTA (TheInsiderStories) – Cellular operator, PT Indosat Ooredoo Tbk (IDX: ISAT) considered to sell 4,000 towers in this year, said the management on Thursday (02/18). In 2019, the provider has released 3,100 towers with total amount Rp6.39 trillion (US$456.43 million) to PT Dayamitra Telekomunikasi (Mitratel) and PT Profesional Telekomunikasi Indonesia (Protelindo).
After the transaction have completed, the third parties signed tower lease back with the company. Based on the agreement, Indosat to lease 178 plots of land to Protelindo, and 369 plots of land to Mitratel for 10 years period
While, the shareholders of PT Hutchison 3 Indonesia (Tri Indonesia) considered backdoor listing as an option to consolidate with the unit of Qatar’ Ooredoo Q.P.S.C. As reported the parent of Indosat has signed an exclusive and non-legally binding Memorandum of Understanding with CK Hutchison Holdings Limited. The commitment which was signed at the end of December 2020, is related to a potential transaction to combine the subsidiaries.
Beside sell the towers, early 2021, decided to leave the satellite businesses and focus on digital services. As an alternative, the company is exploring cooperation with global tech firm Google Inc., in providing internet access to remote areas.
Chief at Indosat, Natasha Nababan, the plans are still in the early stages of discussions. As known, the ministry of information and communication interested in using the Google internet balloon project or Goole Loon to distribute the fourth generation (4G) internet access to remote areas.
The issuer has released Nusantara Satellite 2 orbit slot at 113 east longitude. However, the satellite failed to launch due to technical problems with the launcher rocket. Initially, the unit of Qatar’ Ooredoo QPSC, run the satellite business through PT Palapa Satelit Nusa Sejahtera.
On Oct. 21, 2020, the company sold 43.48 percent shares of the subsidiary to PT Pintar Nusantara Sejahtera and PT Pasifik Satelit Nusantara, the other shareholders of the operator. Talking on merger plans, director and CFO of Indosat, Eyas Naif Assaf, said that there has been no significant progress on the deal, because it still very early.
End of last year, the issuer announced that it has paid off part of the bond has been issued in 2015 amounted to Rp301 billion. For years, the cellular provider facing the debt problems and remained at Rp49.15 trillion. As a result, their credit risk, which is assessed through the debt-to-equity ratio, increased from 4.02 times to 4.51 times.
Indosat has significantly increased its capital expenditure plans to Rp30 trillion for 2019 – 2021, to catch up with peers on 4G network and coverage outside of Java. While the accelerated investment is key to the unit of Ooredoo strategy to remain competitive, it has resulted in the company’ credit metrics weakening amid an intensely competitive operating environment for the Indonesian mobile sector.
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