Hutchison Telecom (HTX) announced today that one of its wholly-owned subsidiaries has entered into a conditional agreement to acquire a 60% equity stake in PT Cyber Access Communications in Indonesia.
Under the agreement Hutchison Telecom will acquire a 60% stake in Cyber Access for a cash consideration of US$120 million.
After completion of the acquisition, Hutchison Telecom will have management control of Cyber Access, with Charoen Pokphand Group Indonesia (CP Group Indonesia) retaining a 40% stake. Both parties have made a major commitment with an initial investment of US$300 million, which Hutchison Telecom and CP Group Indonesia will fund pro-rata.
Dennis Lui, CEO of Hutchison Telecom, said: "We are very excited at the prospect of expanding our footprint into Indonesia, a strategic growth market and leveraging on our experience as a global mobile operator. Together with CP Group, a strong strategic partner in Indonesia, we are well positioned to establish a leadership position in a telecommunications market with tremendous growth potential."
Benjamin Jiaravanon, Executive Chairman of CP Group Indonesia, said: "This is a key milestone in the development of Cyber Access' mobile operations. Given its still low penetration rates, Indonesia is one of the world's top mobile growth markets. With the experienced management team and advanced technology from Hutchison Telecom, we look forward to breaking new ground within the Indonesian mobile communications industry."
The completion of the sale is subject to certain conditions, including the approval of the Capital Investment Coordinating Board (BKPM) of Indonesia to the transfer of the 60% stake under the agreement. Subject to all the
conditions being satisfied, completion of the Company's acquisition of the 60% stake is scheduled to occur in early May 2005.
Cyber Access is one of only two mobile operators in Indonesia that holds a combined nation-wide 2G and 3G mobile telecommunications licence in Indonesia, a country with a low 13.6% penetration at the end of 2004 and strong subscriber growth of more than 40% for last year.