Singapore Telecommunications Ltd. (SingTel) is set to make an A$17.5 billion (US$8.95 billion) bid for Australian company Cable & Wireless Optus Ltd. (CWO), according to reports in both local and overseas media Monday.
The reports, which attribute the information to bankers involved in structuring the deal, have not been confirmed by either company. SingTel declined to comment, while CWO said in a statement to the Australian Stock Exchange (ASX) that it had received revised proposals but that no formal takeover offer has been received.
In its Monday edition, the Financial Times (FT) said the deal is a complicated transaction involving the transfer of a block of SingTel shares now held by the Singapore government, as part-payment to try to assuage concerns about SingTel's government ownership. The government holds about 78 percent of SingTel.
SingTel will keep CWO's businesses together if it wins the deal, the FT said. The other two bidders, Telecom New Zealand Ltd. and Vodafone Pacific Pty. Ltd., are interested only in CWO's mobile business, analysts have said.
The high level of government ownership in SingTel is widely believed to be an obstacle to its efforts to expand in the region.
Cash-rich SingTel made two unsuccessful efforts last year to acquire Cable & Wireless HKT Ltd., Hong Kong's leading telecommunications company, and Time dotCom Bhd., a debt-ridden and politically linked Malaysian carrier. Its rejection, in both cases, was regarded by most analysts as being on political, not economic, grounds.
SingTel, in Singapore, can be reached at +65-838-2007 or via the Web at http://www.singtel.com/