PDA

View Full Version : Ananda Krishnan to take Maxis private?



sirgalahad2010
02-05-2007, 01:48 PM
Cost to AK? Up to RM39 billion.

Cost to Bursa Malaysia? A possible RM33 billion could be wiped off the capitalisation of Bursa Msia.

What is amazing is that apparently there is no shortage of banks willing to lend money to AK to get this deal done.

I mean, we are talking of billions of ringgit here!

I suppose that investment bankers and deal makers will be salivating over Astro, Measat and Tanjong now.

wongstandard
02-05-2007, 04:51 PM
Maxis is under value in Bursa Saham of Malaysia,so the best way is to delist it and trade it in Hong Kong ,Singapore or New YORK IF POSSIBLE.Let be alert that other blue chips counters like YTL,DIGI,UMW, and others thinking of doing the same.Malaysia stock exchange is too under performance and tak laku to attract foreign traders,it only attract hot money .

isarahim
02-05-2007, 05:22 PM
Given that we now have 4 more 3G licencees, a highly red-taped telecommunication sector and very little freedom to innovate, in turn leading to eroding ARPU, I do not think Maxis share is undervalued at all.

In addition, it appears Maxis has taken quite a hit in Indonesia, a combination of poor management along with the Indo-kind of red-tape and foul games.

I think the group must be desperate now to implement a new strategy for growth, which might include more focus on foreign markets, since they're not going to be able to base a growth strategy on Malaysian market at all.

If I had been in AK's shoes right now, I would actually have tried to sell the whole thing off to Vodaphone...or Orascom.

fabregas
02-05-2007, 06:28 PM
I think Maxis bet too much on 3G and other value added service for growth. But most people in Malaysia simply want a phone for making simple phone calls. And the price of the service is just beyond most people. And there is no compelling need for such 3G applications and service, especially at such a high price. Digi has done a great job understanding the market and providing cheap no frills phone calls and SMS service. In Japan, there is a market for these high value services, because the standard of living (much higher income) is higher, so these services are considered cheap. Furthermore , most people spend a lot of time commuting on trains. So they while the time away, reading, listening to music, surfing the net on their phones, etc.

sinleong
02-05-2007, 06:49 PM
I think Maxis bet too much on 3G and other value added service for growth. But most people in Malaysia simply want a phone for making simple phone calls. And the price of the service is just beyond most people. And there is no compelling need for such 3G applications and service, especially at such a high price. Digi has done a great job understanding the market and providing cheap no frills phone calls and SMS service. In Japan, there is a market for these high value services, because the standard of living (much higher income) is higher, so these services are considered cheap. Furthermore , most people spend a lot of time commuting on trains. So they while the time away, reading, listening to music, surfing the net on their phones, etc.

actually digi also bid for the 3G license but they didnt get it.

isarahim
02-05-2007, 08:32 PM
actually digi also bid for the 3G license but they didnt get it.
Yes. Digi lost out in both 3G races (WCDMA and WiMax), largely because they're foreign controlled. As Fabregas points out they don't really need it either. They have much cheaper infrastructure than Maxis. Hence, Digi can continue to thrive with relatively low revenue per user.

kwchang
02-05-2007, 08:52 PM
a bit off the trend of title of discussion but I believe 3G is an expensive hype. Mark my words, all that investment will be hard-pressed to bring returns, especially with prudent Malaysians.

I'd go for a device with WiFi that allows me to get emails and surf the net whenever there are free hotspots like the KLIA.

This is one situation where emulating the Japanese is not a good thing.

isarahim
03-05-2007, 12:35 AM
Agreed.

To date the Skype phones I've seen are pretty crappy and flimsy devices from small manufacturers with poor support.

However, soon the Nokias, Motos and Sony Ericssons are coming with Skype built-in.

Then the telcos will fall like the dinosaurs they are... only the lean&mean ones (like Digi) and the ones with huge footprint (like Vodaphone and Orascom) will survive.

That's an additional reason why I think the Maxis-type cell operators will face serious problems the next 5-10 years.

gtl
03-05-2007, 08:28 AM
wud Telekom face the same fate in the near future?

sirgalahad2010
03-05-2007, 01:44 PM
AK already holds an indirect 47% of Maxis.

If he has to pay off 40% of the shareholders at RM15.60 per share, his cash outlay would be around RM15.7 billion.

Maxis's problems:

- difficult to expand further in its home market (Msia)
- has to find new sources of revenue (India, Indonesia, Sri Lanka)
- significant capex needed to grow overseas (US$4 billion in India over the next 5 years?)
- which would adversely affect Maxis's dividends paid to shareholders

Possibilities (according to the Spore Business Times (http://business-times.asia1.com.sg) May 1) and my own thinking:

- for Maxis to find a strategic investor (private equity group, another telco such as Singtel or Vodafone or a govt-linked company such as Temasek Holdings)
- to relist in 3-4 years time (not necessarily on Bursa Msia)
- separately list its operations in India and Indonesia
- go big on new technologies in its home market to take on Telekom Msia

I think AK, and his advisors, have pretty much thought through all of these issues. Don't forget that he can buy the best brains out there to advise him!

jararaca
03-05-2007, 03:38 PM
I think the trend now is to list it elsewhere other than Malaysia. No red tape, No bumi quota to fill. no rent seeker to please. Nothings.

Infact, many find HK, London, Singapore the preferred choice to have better liquidity, growth, transparency and raising of more capital.

Some of the success include Samling group, parkson in HK. Bursa admitted the trend is worrisome, but continue to operate in the mode of denies, semuanya_ok.

isarahim
03-05-2007, 04:00 PM
his cash outlay would be around RM15.7 billion.

significant capex needed to grow overseas (US$4 billion in India over the next 5 years?)
US$ 4 billion is about RM 14 billion. I.e. somewhat less than the outlay for delisting.

aurora97
03-05-2007, 04:42 PM
Thx for all the money i have made from you Maxis, you will be deerly missed (*sobs*) form the listing boards. The glowing red and green lights, from single digits to double digit growths, the roller coaster rides we took during the economic cycles and the generoous "Ang Pow" you give us every fiscal year end.

Stocks for Cash, Public listing to Private listing...

Maxis
199X-2007

sirgalahad2010
03-05-2007, 05:45 PM
US$ 4 billion is about RM 14 billion. I.e. somewhat less than the outlay for delisting.

That shouldn't be a problem for a financially strong strategic investor - like any of the big private equity funds or Temasek or SingTel.

I heard that big names in private equity like KKR, Apollo and TPG have been sniffing around the region for deals.

Anyways, I saw on ChannelNewsAsia just now that AK and associates will spend at least RM39.47 billion to take Maxis private. They have set up a SPV, Binariang GSM, which through CIMB Investment Bank will offer RM15.60 per share for the outstanding 2.53 billion shares in Maxis that AK and his associates do not already own.

Looks like the game has started.

And it looks like the investment bankers at CIMB will collect a fat bonus if this deal goes through.

Jokee
04-05-2007, 11:35 AM
Astro to raise subscription fees.
http://thestar.com.my/news/story.asp?file=/2007/5/4/nation/20070504110237&sec=nation

Sato
04-05-2007, 02:14 PM
Astro to raise subscription fees.
http://thestar.com.my/news/story.asp?file=/2007/5/4/nation/20070504110237&sec=nation

last time they talk about reducing the fee when they reach their target amount of audiences now they are talking about increase of 15%, this is really too much! :eek: :mad:

jianwei85
05-05-2007, 03:59 AM
they will never be satisfied. anyway, i m wondering whos gonna benefit from this privatisation?

kwchang
05-05-2007, 11:11 AM
...i m wondering whos gonna benefit from this privatisation?That is the very reason to pull out of being public where every massive financial action needs the consent of the share-holders. Once AK keeps the company to himself, he can do whatever he likes. He is probably going to take drastic risks for the sake of making moves to improve the business potential of his company. If it fails, he does not have to answer to you because your money is safe with you in your bank, not in his company.

So why question "who's going to benefit" because it is like you asking me why I have spent my hard-earned money on investing in some share in the stock-market. It is my money ... why are you asking me what I do with it. See my point?

sirgalahad2010
05-05-2007, 01:22 PM
Exactly right.

Of course, the kicker is that when Maxis chooses to re-list in 3-4 years time, it may not want to do so on Bursa Msia. You can bet that SGX (the Spore stock exchange) will be after them to list in Spore.

And why not, if they can get a better valuation in Spore, and no pesky minimum 30% requirement?

For sure, the people who will make out handsomely are the investment bankers at CIMB Investment Bank. Consider the 5 deals they have done so far:

- the RM9.3 billion privatisation of Malakoff
- the RM7.6 billion takeover of OYL Industries by Japan's Daikin
- the RM9.6 billion Wilmar International's buyout of the agribusiness activities of Robert Kuok
- the RM31.4 billion merger of 3 plantation companies into Synergy Drive

and now

- the RM39.9 billion buyout offer for Maxis.

Yup, there will be quite a few happy CIMB investment bankers come bonus time at the end of the year or early next year!

And quite a few more Ferraris, Porsches and the odd Lamborghini on the roads in KL this time next year! :D

jianwei85
05-05-2007, 04:03 PM
ok. so mr ananda is going all out in expanding maxis and by taking maxis private he can assume all decisions without having shareholders to veto here or there. he alone shall plot the course of maxis. the adage of high risk, high returns could be seen implemented very soon?

btw, if this is a trend according to bursa, then wouldnt it be a case of globalisation forces from within?

if u have a quota to fill, red tapes and a few more other rules that affects your capitalisation, u too would "branch out" to other countries? but in this case maxis literally "tree-ed out".

bursa is going to have to think of ways to keep capitalisations in M'sia.

firefox
05-05-2007, 05:37 PM
glad Mr Ananda gave us Astro what will life be without astro, Larry King and Epl...who cares what he does with his empire not my buisness thats his perogative.

sirgalahad2010
08-05-2007, 08:05 AM
A Spore Straits Times (http://straitstimes.asia1.com.sg) today report today said that the main owners of NexNews, Tong Kooi Ong and Vincent Tan, had announced that they will make a general offer for shares of listed NexNews that they do not already own.

A successful takeover bid would mean that NexNews would be taken private and delisted from Bursa Msia.

And here is the kicker: the report quoted several bankers as saying that Tong and Tan are considering the prospect of a fresh listing in Spore.

Are we seeing the beginning of a trend here - that more and more "non-bumi" listed companies may take themselves private, delist from Bursa Msia and re-list on another stock exchange?

gtl
08-05-2007, 08:31 AM
this is a global economy, if KLSE are not good enough, go and list in other exchanges that brings more value to your company. i don't see anything wrong with it. KLSE have to learn to compete.......if not perish.
this is at the tip of the iceberg, malaysia are losing their edge and need to wake up to competition.

Teeque
09-05-2007, 02:39 AM
...Are we seeing the beginning of a trend here - that more and more "non-bumi" listed companies may take themselves private, delist from Bursa Msia and re-list on another stock exchange?
not surprising since the bulk of Asia's FDI funds and the fund managers are all parked there, in the little red dot...

sirgalahad2010
09-05-2007, 08:47 AM
Well, now we know what Temasek Holdings thinks of Telekom Msia.

According to a report in the Spore Straits Times (http://straitstimes.asia1.com.sg), Temasek sold a 3.3% stake in Telekom Msia for RM1.21 billion. This was the final stake sale, as Temasek has been selling its Telekom shares gradually over the past couple of years.

This means that Temasek has exited from Telekom, 3 years after it invested in the Msian company.

When a savvy investor like Temasek chooses to sell its stake in Telekom Msia, it means that they don't see much prospects for TM down the road.

Which makes the position of TM CEO Abdul Wahid Omar open to question.

Now, let's wait for Digi to be taken private!

patwon
09-05-2007, 06:21 PM
shakey KLSE unclear guidelines,poor supervision,snail pace reform and koyak second board mean less investment here and hence low value for blue chips and diff.to raise foreign funds.i believe MAXIS will have to list somewhere like hong kong or better india.

Raikonen
09-05-2007, 07:24 PM
There are too many rulings/guidelines to adhere to in Bursa, unclear sometimes to the regulators themselves....what more with lots of affirmative shares to be given away to rent seekers. Listed companies here are always "approached" by politicians for "donations" :D

USJ27Resident
19-05-2007, 04:17 AM
Maxis is worth billions... But what about Celcom?

Celcom had a ten (yes! 10 years!) head start with the cellular phone business and that made that TR fella going from "rag" to "riches"...

...AND back to from wherever he came from... 'almost' penniless...

Now suing Danaharta la... and the rest of his Govt contacts that 'was supposed' to take care of him... :rolleyes:

TR even had almost got the national airlines going bust ( he allegedly threaten the Govt to either buy back the shares @ RM8 or he would close the airlines down overnight !!)

Strangely - when he sold Celcom to Telekoms Malaysia, he got the audit reports saying that it was worth millions... AND to add salt into the injury, TM took the valuation at face value :eek: only to find out the huge losses that was under the pile of hidden sh!t AFTER buying Celcom...

Sheeeeesh!