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Maxis Bhd Eyes U Mobile Acquisition Amid IPO Plans
Maxis Bhd., a major telecommunications firm in Malaysia, is exploring the possibility of acquiring U Mobile Sdn. as part of its strategic expansion within the country. Sources familiar with the development have revealed that Kuala Lumpur-listed Maxis has expressed interest, although discussions are in the preliminary phase.
Vincent Tan and Singapore Technologies Telemedia (backed by Temasek Holdings) are among the prominent shareholders of U Mobile. A potential sticking point in the negotiations is the valuation, with U Mobile's owners seeking over 10 billion ringgit ($2.1 billion). However, there is no certainty that a deal will materialize.
In a recent communication to Bloomberg News, Vincent Tan stated that U Mobile is rejecting the buyout proposal from Maxis and aims to pursue an initial public offering (IPO) by the end of July. U Mobile has been contemplating an IPO since 2021. Tan affirmed, "We are rejecting Maxis' offer," and confirmed their intention to proceed with the IPO.
A representative for U Mobile declined to comment on market speculations and emphasized the company’s commitment to advancing its innovative 5G products and services. The company is also preparing to participate in the Malaysian government’s tender for constructing the nation's second 5G network. Meanwhile, Maxis and ST Telemedia representatives refrained from commenting on the situation.
Established in 2006, U Mobile is recognized as Malaysia’s youngest telecom operator. It boasts more than 4,000 4G sites and a 5G-ready network, along with services in fintech and digital payments. Recently, U Mobile signed an agreement involving an undisclosed equity stake in Digital Nasional Bhd., a state-owned entity responsible for building Malaysia's 5G infrastructure.
Maxis has seen its shares decline by 9.4% this year, resulting in a market valuation of 27.3 billion ringgit. According to its annual report, the company serves over 13 million customers and operates a fiber network spanning more than 22,000 kilometers (13,670 miles).
