SIMBA Telecom discussion thread

[JAYSCS]

As a fun little thought exercise, note that Singtel owns Optus, the Australian telecommunications company. So much so that Singtel (the multi-faceted corporation) is much more Australian than Singaporean in terms of its revenues and real business activities. In this SIMBA-M1 corporate transaction Keppel is selling its large controlling interest in M1 (the telecommunications part, not quite all of M1) to Tuas, SIMBA's parent company. Tuas happens to be...an Australian company! Funny how that works.

Hypothetically the government could block this transaction; it has that power. But then the Australian government might get upset and (in extremis) retaliate: the Australian government could require Singtel to divest Optus. Which wouldn't be a great outcome for anyone, would it?

Therefore I think what'll end up happening is that mobile spectrum will be reallocated, and we'll end up with 3 MNOs. We already have 3 MNOs on 5G since StarHub and M1 have a joint 5G venture. A Singtel/SIMBA-M1/StarHub constellation of MNOs would shrink 4G to 3 MNOs but maintain the MNO count on 5G. That seems tolerable to me, but we'll see what the government thinks.

I suppose the government could explore (again) whether there's room for a 4th MNO, another SIMBA basically. But that might have to be a long-term project.

Power point of view, this is from a different perspective of the takeover saga. Could it really be a country vs country thingy, after all, telco industry is actually considered national security priority. Hmm, that is why Simba has the capability to make the offer, with strong backup from another country? If this is considered, the buy over may not be approved.

 

[froztheart]

thanks to everyone here investing / prepaid into wallet during the top 20 free 20, these fund now used to buy over m1

that's their plan all along. But then, good investment by all the customers. Want better network, we can help you by buying M1. But you have to help me to help you first. Many used CDC vouchers to top up credits too.

TaDa, they got good cashflow.

 

[froztheart]

Power point of view, this is from a different perspective of the takeover saga. Could it really be a country vs country thingy, after all, telco industry is actually considered national security priority. Hmm, that is why Simba has the capability to make the offer, with strong backup from another country? If this is considered, the buy over may not be approved.

Well, if using the same US reasoning of "national security", a lot of our assets will not be privatised to begin with.
Now we shall see how IMDA assess this takeover, might probably end up like Grab's takeover of Uber. Approved but with T&C attached.

 

[sky1978]

Power point of view, this is from a different perspective of the takeover saga. Could it really be a country vs country thingy, after all, telco industry is actually considered national security priority. Hmm, that is why Simba has the capability to make the offer, with strong backup from another country? If this is considered, the buy over may not be approved.

They are already operating here with a 14% market share in the postpaid market, so if they are not currently a security risk, then it is difficult to argue that they will become a national security risk after hitting a 38% market share under a merged entity. If regulators have a problem with the new combined market share, then it will also indirectly close off any M&A between the big 3, and the market will continue for a long time with 4 players.

The main reason why they have the capability is because of their market valuation and possibly a better financial market as their backing. They are listed on ASX, and with only a 14% SG market share, they are already being valued at AUD2.5b before the acquisition announcement. All they need is just to sell another AUD400mil new equity to complete the purchase, with the remaining probably financed through debt. It took them a day to complete the 400mil placement without any discount, and these new investors magically earn 30% the next day.

https://www.marketindex.com.au/asx/tua?src=search-all
https://data-api.marketindex.com.au.../inline/completion-of-institutional-placement

In terms of profitability, they have been making losses for the past few years and only managed to turn a profit recently with 3m net profit for their latest half year. In comparison, SH trading on SGX fetched a market cap of SGD2bil despite having a bigger market share and higher net profit.
https://data-api.marketindex.com.au...pdf/inline/appendix-4d-half-year-results-fy25

 

[JAYSCS]

They are already operating here with a 14% market share in the postpaid market, so if they are not currently a security risk, then it is difficult to argue that they will become a national security risk after hitting a 38% market share under a merged entity. If regulators have a problem with the new combined market share, then it will also indirectly close off any M&A between the big 3, and the market will continue for a long time with 4 players.

The main reason why they have the capability is because of their market valuation and possibly a better financial market as their backing. They are listed on ASX, and with only a 14% SG market share, they are already being valued at AUD2.5b before the acquisition announcement. All they need is just to sell another AUD400mil new equity to complete the purchase, with the remaining probably financed through debt. It took them a day to complete the 400mil placement without any discount, and these new investors magically earn 30% the next day.

https://www.marketindex.com.au/asx/tua?src=search-all
https://data-api.marketindex.com.au.../inline/completion-of-institutional-placement

In terms of profitability, they have been making losses for the past few years and only managed to turn a profit recently with 3m net profit for their latest half year. In comparison, SH trading on SGX fetched a market cap of SGD2bil despite having a bigger market share and higher net profit.
https://data-api.marketindex.com.au...pdf/inline/appendix-4d-half-year-results-fy25

Nevertheless, see how the authority views the take over. After all, it is still a foreign acquisition. Telco industry is always a sensitive issue that is why ST has to release its stake from 48% to 20% for Malaysia U Mobile for its 5G license to operate without any unhappiness from the local.

 

[twosix]

Imda will gladly accept the merger, else the market is too saturated and may not improve fast enough.

 

[JAYSCS]

Imda will gladly accept the merger, else the market is too saturated and may not improve fast enough.

On the contrary, approving the take over is actually hinder the improvement as there will be less competition. It is better not to approve I think.

 

[BBCWatcher]

After all, it is still a foreign acquisition.

It's a little complicated.

But let's suppose for sake of argument SIMBA's parent company is "Australian." Singtel happens to own 100% of Optus, the Australian telecommunications company. In fact, Optus is Singtel's biggest subsidiary (last I checked anyway). Would it be reasonable for the Australian government to reconsider Singtel's ownership of Optus if Tuas Limited cannot buy M1?

 

[JAYSCS]

It's a little complicated.

But let's suppose for sake of argument SIMBA's parent company is "Australian." Singtel happens to own 100% of Optus, the Australian telecommunications company. In fact, Optus is Singtel's biggest subsidiary (last I checked anyway). Would it be reasonable for the Australian government to reconsider Singtel's ownership of Optus if Tuas Limited cannot buy M1?

Indeed it is not as simple, it is a chicken and egg issue. Why the take over, could it be because Australia views ST in Australia position and encourage Simba to go ahead with the acquisition? In the event of a blockage, will Australia deals with ST? So in consideration of such scenario, SG may aporove the take over? See how it turns out.

 

[frizee]

So is it a good time to come back to Simba? Or await for new plans?

 

[BBCWatcher]

Indeed it is not as simple, it is a chicken and egg issue. Why the take over, could it be because Australia views ST in Australia position and encourage Simba to go ahead with the acquisition?

Almost certainly not. Australian companies routinely expand internationally and make their own business decisions. As do Singaporean companies.

 

[sky1978]

It's a little complicated.

But let's suppose for sake of argument SIMBA's parent company is "Australian." Singtel happens to own 100% of Optus, the Australian telecommunications company. In fact, Optus is Singtel's biggest subsidiary (last I checked anyway). Would it be reasonable for the Australian government to reconsider Singtel's ownership of Optus if Tuas Limited cannot buy M1?

I think ST's ownership of Optus is not at the same level as Simba's ownership of M1. ST have a controlling shareholder with a 50% stake, and we all know who it is, whereas Simba's largest shareholder is a private individual/family with slightly above 30% shareholding.

 

[ecommercenoob]

I am using circles life and other line waiting for sim to arrive and port in to MyRepublic, if simba successfully buy m1, which is the best solution for me to port out to or stay as it is?

 

[tidus792]

I am using circles life and other line waiting for sim to arrive and port in to MyRepublic, if simba successfully buy m1, which is the best solution for me to port out to or stay as it is?

Nobody knows for now. Wait for more news.

 

[ecommercenoob]

Simba going to raise price right?

 

[speedsonic]

Simba going to raise price right?

like pap..aya

 

[reddevil0728]

I am using circles life and other line waiting for sim to arrive and port in to MyRepublic, if simba successfully buy m1, which is the best solution for me to port out to or stay as it is?

why need to decide now?

Simba going to raise price right?

we don't have crystal ball for the future.

Simba's acquisition of M1 may drive down mobile plan prices, analysts say - CNA​

​

Telco price undercutting expected to subside after sale of M1 to Simba: Analysts - ST​

which you believe?

like pap..aya

even without this who say they wouldn't???

 

[chari-men]

I don't think they will increase prices for existing plans .. likely will create more enhanced plans as they are in a better position after the acquisition to cater to certain segments of the market which are more profitable...

 

[twosix]

On the contrary, approving the take over is actually hinder the improvement as there will be less competition. It is better not to approve I think.

why do u think more competitors mean more competition? in the past yes, but simba/tpg is around long enough to settle the dusts. already m1 bites the dust.

 

[jayjay0702]

Is it the end of $10/m mobile plan days?