KUALA LUMPUR (Nov 30): edotco Malaysia Sdn Bhd, the 63%-owned subsidiary of Axiata Group Bhd, is acquiring fellow telecommunications infrastructure provider Touch Mindscape Sdn Bhd for RM1.7 billion on a debt-free and cash-free basis.

edotoco said the acquisition strengthens its aspiration to be among the top five tower companies in the world, and cements its home market leadership position as the largest independent tower company in Malaysia.

"The transaction enables edotco to increase its tower market share from approximately 21% to 25%," edotco added in a statement.

Touch Mindscape, a unit of Touch Group Holdings, owns a 80% stake in Touch Matrix — a network facility provider linked to the Pahang royalty — with the balance 20% held by Yayasan Pahang.

“I am pleased with the rare opportunity to be able to acquire a towerco in Malaysia, and one with such a sizeable and high-quality telecommunication infrastructure portfolio," said edotco Group CEO Adlan Tajudin.

"The proposed acquisition is in line with edotco’s growth strategy and plans to scale up and future-proof our operations to support national digital ambitions in the countries of our operations," he said.

edotco managing director Wan Zainal Adileen said the acquisition strategically adds a portfolio of about 1,000 tenanted towers to edotco’s operations in Malaysia, where it is already providing co-location to major mobile network operators.
 
“This opportunity expands edotco’s existing presence by significantly scaling up our tower portfolio in the three States of Pahang, Negeri Sembilan and Melaka with very limited overlap. The towers in these States come at very high co-location ratios of 3x (Melaka), 3.6x (Negeri Sembilan), and 2.4x (Pahang).

“The Touch Mindscape tower portfolio also includes towers in key strategic locations of Kuala Lumpur, Putrajaya, Perak and Kedah. More importantly, this proposed acquisition enhances edotco’s capability and capacity to support the wider provision and improvement of connectivity to the public for the development of the socio-economy of Malaysia,” he added.

edoto said the exercise also allows the company to secure a strategic fibre network which is crucial to further future-proof the telecommunication infrastructure portfolio.

It added that the acquisition is scheduled to be completed by the end of this year. Upon completion, it will grow edotco’s owned and managed portfolio of towers to over 43,000 towers across core markets of Malaysia, Bangladesh, Pakistan, Sri Lanka, Cambodia, Myanmar, Philippines and Laos.

Meanwhile, Axiata said in a bourse filing that the exercise is expected to contribute positively to the group’s future earnings and support its long-term strategies and objectives.

Shares of Axiata fell eight sen or 2.01% to close at RM3.90, valuing the group at RM35.78 billion.