Thai operator True Corp is planning to raise up to Bt65bn (US$2bn) from a new share issue, including Bt28.6bn (US$882m) from China Mobile.
Earlier today, trading in the company had been halted upon request from the operator ahead of a board…
Thai operator True Corp is planning to raise up to Bt65bn (US$2bn) from a new share issue, including Bt28.6bn (US$882m) from China Mobile.
Earlier today, trading in the company had been halted upon request from the operator ahead of a board meeting.
True Corp is selling over 10 billion shares at Bt6.45 each, a discount on their latest price of Bt7.45, “in order to strengthen its financial position”, it said in a stock exchange announcement.
More than half the shares, around 5.6 billion, will be sold to existing shareholders at the ratio of 2.5725 existing ordinary shares to 1 newly issued ordinary share. The remaining shares will be offered to China Mobile, the world’s largest operator in terms of subscribers, giving it an 18% stake in the company.
True Corp said it picked the operator because of “its ability to strengthen the company’s financial results and its potentiality to grow business cooperation with the company”.
At present, True Corp is majority-owned by local conglomerate Charoen Pokphand Group.
Having China Mobile as a new investor is in line with True Corp’s previously-announced plan to bring in a foreign partner to expand in Southeast Asia.
In March, its CEO Suphachai Chearavanont told reporters that his company was seeking to offer new shares equivalent to 25% of its existing equity to a new investor.
True is the only major Thai operator without at least one foreign partner. Its largest shareholder is local conglomerate Charoen Pokphand.
Chearavanont said the telco was looking to gain an extra 100 million subscribers in the region by 2019.
Its first deal could be in Myanmar. Earlier this year, it emerged that True was in talks with Myanmar-based ISP Yatanarpon Teleport (YTP) to start offering joint mobile services in the country.
The Thai operator – which provides mobile, fixed-line and broadband services – listed some its infrastructure assets in a US$1.8bn IPO late last year but most of the proceeds are expected to be used to repay debt.
True Corp’s mobile unit True Move is the third largest in the country far behind Shin Corp’s AIS and Telenor’s Dtac.
Thailand is currently under martial law following a coup in May.
China Mobile has over 775 million customers in its home country. It also has wireless operations in Hong Kong and Pakistan.
Last year, it partnered with Vodafone to apply for mobile licences in Myanmar but later withdrew from the process. The frequencies eventually went to Telenor and Ooredoo.
China Mobile, which reportedly mandated CICC for the deal, did not respond to requests for comments. True Corp mandated Deutsche Bank.
