Several Singaporean telecoms and internet companies, including mobile operators StarHub and M1, are calling for the regulator to block the acquisition of the country’s NBN operator by a SingTel trust.
In late August, SingTel’s NetLink Trust agreed…
Several Singaporean telecoms and internet companies, including mobile operators StarHub and M1, are calling for the regulator to block the acquisition of the country’s NBN operator by a SingTel trust.
In late August, SingTel’s NetLink Trust agreed to acquire fibre network operator OpenNet in a deal worth S$126m (US$98.3m).
OpenNet is responsible for building and operating the fibre platform for Singapore’s next generation nationwide broadband network (Next Gen NBN).
Although SingTel has a 100% economic interest in NetLink Trust, managed by CityNet, it has no effective control over the trust, the operator said at the time.
But today several industry players said the “proposed consolidation would see SingTel becoming the 100% beneficial owner of the only nationwide fixed telecommunications network in Singapore, apart from SingTel’s own network.
“Moreover, the business trust used in this proposed consolidation has statutory and contractual obligations to act in SingTel’s interests,” the companies argued in a joint statement.
In an email to TelecomFinance today, a SingTel spokesperson reiterated that it does not have effective control over NetLink Trust or CityNet. She said: “NetLink Trust and CityNet operate within a strict regulatory framework that ensures open access to the NextGen NBN fibre network and regulated pricing to all industry operators.”
Singapore’s largest mobile operator also said last month it will end its role as OpenNet’s key contractor for installing and maintaining Next Gen NBN within 12 months.
In addition, South East Asian giant SingTel is expected to reduce its stake in NetLink Trust to less than 25% by April 2018. The telco had originally agreed to do this by April 2014 but said the extension gives NetLink time to integrate Next Gen NBN operations and assets.
The operators said in their joint statement today that if the regulator decides to approve the deal, they will call for “stronger safeguards”.
These include “the appointment of government and industry representatives to the boards of CityNet/OpenNet and requiring SingTel to abide by its original commitment to sell down its stake in NetLink Trust to less than 25% by 2014”.
They also ask for “real penalties” to be imposed for non-performance by CityNet/OpenNet.
SingTel led the OpenNet consortium that won the ultra-high-speed broadband network tender in the city state in 2008. OpenNet describes Next Gen NBN as “the world’s first nationwide all-optical fibre platform” and says it is capable of delivering speeds of 1Gbps and above to homes, businesses and other premises. OpenNet’s network passes about 1.2 million residential and 26,000 commercial premises.
