PETALING JAYA: Telecommunications player OCK Group Bhd is acquiring Vietnam’s largest independent telecommunications tower company, South-East Asia Telecommunications Holdings Pte Ltd (SEATH), for US$50mil (RM203.85mil) via its 60%-owned subsidiary in an all-cash deal.
The subsidiary, OCK Vietnam Towers Pte Ltd, is also 40% owned by CapAsia, a private equity fund.
OCK and CapAsia would fork out US$20mil to finance the acquisition, while the balance US$30mil would come from bank loans.
OCK Vietnam has signed a conditional share sale and purchase agreement with Vietnam Infrastructure Ltd for the proposed SEATH acquisition.
SEATH has 1,938 sites across key locations in Vietnam, while the second-largest independent tower owner has about 500 sites.
According to OCK group managing director Sam Ooi, the acquisition paves the way for the company to enter the Vietnam market, which is one of the biggest markets in Asean with many growth opportunities.
“SEATH is a profitable business and will contribute positively to OCK’s strategic growth following the completion of the acquisition. Post-acquisition, OCK will have approximately 3,000 tower assets in Asean,” he told reporters after the signing ceremony here yesterday. SEATH had recorded a profit after tax of US$1.8mil last year.
On expansion in Vietnam, Ooi said OCK had the intention of growing SEATH’s portfolio, but it had yet to earmark any budget for this.
“Nevertheless, we are committed to improving SEATH’s tenancy ratio to 1.27 times by the year-end from 1.23 times as of the end of last year.
“In the longer term, OCK will see SEATH’s tenancy rate improving to 1.5 to 1.6 times in three to four years,” he said.
With the rollout of the 4G or long-term evolution network in Vietnam, the telecommunications market is expected to grow significantly, as consumers will continue to embrace the benefits of connectivity.