TPG wins Singapore mobile bid in $98m deal
- 15 December, 2016 10:37
Australian telecommunications and internet service provider, TPG Telecom (ASX:TPM), has had its first win in its bid to add mobile carrier services to its portfolio following a successful tender for the new entrant spectrum auction in Singapore.
The total value of the deal was $S105 million ($98.6 million) and saw TPG acquire all of the spectrum available at the auction, which was comprised of two lots of 2x5MHz of 900MHz spectrum and eight lots of 5MHz of 2.3GHz spectrum.
In addition to the initial cost, TPG said it anticipates incurring costs of $S200 million ($187.8 million) to $S300 million ($281.7 million) for capital investment to establish a mobile network with nationwide coverage by September 2018.
All costs are expected to be financed through TPG’s existing debt facilities and cash generated from the Australian business.
TPG said it expects to begin delivering services in 2018 and that the venture should be earnings (EBITDA) positive once it reaches a market share of between five and six per cent.
“This rare opportunity will enable TPG to expand its business into Singapore, bringing tremendous value to Singaporean consumers whilst generating excellent long term returns for TPG shareholders,” the company said in a statement.
The company informed investors of the bid on 2 September after it submitted an Expression of Interest (EOI) to prequalify for the ‘New Entrant Spectrum Auction’ being carried out by Singapore’s Infocomm Development Authority (IDA).