20 March 2017

M1's Trading Halt

sharing for convenience.

(Bloomberg) -- M1 Ltd.’s owners are exploring options including a sale of Singapore’s smallest mobile operator as the city-state gears up for a new entrant into the wireless market, according to people with knowledge of the matter. Keppel Corp., Axiata Group Bhd. and Singapore PressHoldings Ltd. are working with an adviser to conduct a strategic review of their combined 61 percent interest in M1, the people said, asking not to be identified because the discussions are confidential. The carrier, which offers fixed-line and mobile services to more than 2 million customers, has a $1.3 billion market value. The potential sale of Singapore’s third-largest carrier comes as the city-state prepares for the roll-out of a fourth mobile operator with TPG Telecom Ltd. slated to begin wireless services in 2018. The regulator has said it wants to introduce more competition in the city-state to bring down phone bills and improve services. Temasek Holdings Pte has studied ways for Keppel, a portfolio company, to divest non-core assets including its stake in M1, as part of a regular review of investments, people familiar with the matter said in January last year. Executives at the state investment company had also discussed the possibility of Keppel paring its stake in office landlord KeppelREIT. Malaysian wireless carrier Axiata has a 29 percent stake inM1, while Keppel has a 19 percent holding and Singapore Press owns 13 percent, according to data compiled by Bloomberg. A representative for Axiata didn’t immediately respond to emails seeking comment. Representatives for M1, Keppel and SingaporePress didn’t immediately respond to Bloomberg queries. Plans to sell Singaporean telecom stakes have made little progress. Shareholders in the second-largest operator StarhubLtd. were weighing a sale in July, with Qatar’s Ooredoo QSCseeking to sell its indirect stake in the carrier, people familiar with the matter said at the time. The city state’s current telecom operators includingSingapore Telecommunications Ltd. and StarHub are likely to see average revenue per user decline by as much as 16 percent in the next five years, according to OCBC. TPG Telecom may gain the mobile revenue market share of about 6 percent by 2021, the research firm said Friday. 

M1 is now trading at 7.3x EV/Trailing EBITDA, compared to Starhub at 8.15x and Singtel at 15.4x.