To The Moon

Advanced Info Service (AIS), Singtel's Thai associate, has announced several updates to the acquisition of Triple T Broadband (TTT) and Jasmine Broadband Internet Infrastructure Fund (JASIF). On July 4, AIS announced it would acquire approximately 7.53 billion shares representing 99.87% of total paid-up shares of TTT from Jasmine International (JAS) subsidiary Acumen Company via AIS’ 99.99%-held subsidiary Advanced Wireless Network (AWN) for a consideration of THB19.5 billion ($725 million). It also announced its acquisition of a 19% stake equivalent to 1.52 billion units of JASIF for THB12.92 billion, valued at 8.50 baht per unit. In a general announcement dated Oct 19, AIS received notice of the approval of JAS’ sale of its investment units in the fund and its shares in TTT to AWN, following a JASIF unitholders meeting on Oct 18. Also approved was the waiver of and/or amendment to certain provisions relating to the Undertaking Agreement, the termination of the Escrow Account Agreement and the amendment to the fund’s scheme to the extent necessary to reflect the unitholders’ resolution. However, other condition precedents were not approved, namely the waiver of and/or amendment to certain provisions relating to the lease and rental payment of optical fiber cables, the termination of the Rental Assurance Agreement and the Marketing Services Agreement, the increase in advance rental payment payable by TTT to the fund, and the amendment to the fund’s scheme to the extent necessary to reflect the unitholders’ resolution, including any amendment to the Fund’s scheme which ensures the fund’s recovery of investments in an amount not exceeding the advance rental payment payable by TTT to the fund. AIS CFO Tee Seeumpornroj says that the disapproval to waive or amend the provision related to rental agreement which is viewed as key to TTT competitiveness and a mismatch with the strength of the new sponsors AIS and AWN. AIS views this is a material issue which requires "careful reconsideration" of whether the proposal to acquire TTT and JASIF will sustain and will inform the next steps after consideration. Shares in $SINGTEL(Z74.SI)$closed 3 cents or 1.2% down at $2.46 on Oct 19.