Measat Said to Hold Talks on Selling Satellite Stakes, Forming Partnership

Measat Global Bhd., controlled by Malaysian billionaire T. Ananda Krishnan, has held talks with Eutelsat Communications (ETL) SA and Asia Satellite Telecommunications Ltd. on selling stakes in satellites, according to three people familiar with the discussions.

The negotiations may also lead to a partnership between Measat and one of the companies, two of the people said, declining to be identified because the discussions are private. An agreement would give them access to Measat’s four satellites and help share costs of future launches.

A sale would help Ananda Krishnan, Malaysia’s second- richest man, raise funds after buying out three companies last year for a total 7.9 billion ringgit ($2.6 billion). The billionaire, whose wealth was estimated to be $9.5 billion last year by Forbes magazine, also owns a majority stake in Malaysia’s largest mobile-phone company, Maxis Bhd. (MAXIS)

“It makes sense to have such alliances as it enables the parties involved to leverage on each other capacities as long as there is no overlap,” said Clare Chin, head of research at Kuala Lumpur-based CLSA Securities Malaysia Sdn. “It would also help them to save capital expenditure costs.”

Measat may be interested in sharing assets, splitting the costs of new launches, and exchanging satellite stakes, two of the people said. Chief Executive Officer Paul Brown-Kenyon wasn’t immediately available for comment when contacted by telephone and e-mail.

Photographer: Matthew Staver/Bloomberg

Malaysian billionaire T. Ananda Krishnan. Close

Malaysian billionaire T. Ananda Krishnan.

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Photographer: Matthew Staver/Bloomberg

Malaysian billionaire T. Ananda Krishnan.

Rising Prices

Demand from broadcasters and phone carriers in emerging markets including China, India and Indonesia is rising, driving up average bandwidth prices by more than 5 percent annually in Asia, C.W. Cheung, Asia Pacific director at telecommunications consultants Ovum, said in an interview in Hong Kong yesterday.

“In some markets prices of satellite bandwidth are starting to go up, and this is driving investment activities in the sector,” said Cheung said.

Kuala Lumpur-based Measat, which beams signals to Asia, the Middle East, Europe and Australia, said on June 7 it’s ordering a new satellite costing about 1 billion ringgit scheduled for launch by the end of 2013. Ananda Krishnan, 73, delisted Measat along with Kuala Lumpur-based power and gaming company Tanjong Plc and pay-TV broadcaster Astro All Asia Networks Plc last year.

Paris-based Eutelsat is the world’s third-largest fixed satellite operator, with a fleet of 27 satellites covering much of the world, according to its website. Vanessa O’Connor, a spokeswoman, declined to comment.

Hong Kong-based Asia Satellite, or AsiaSat, has three in- orbit satellites covering the Asia-Pacific, according to its website. Winnie Pang, corporate affairs manager, declined to comment.

This month, Ananda Krishnan raised $888 million from the initial public offering of Bumi Armada Bhd., the country’s biggest supplier of support vessels for the oil and gas industry. The billionaire is in talks to sell his gaming company Pan Malaysian Pools Sdn. for more than 2 billion ringgit, Maybank Investment Bank Bhd.’s analyst Yin Shao Yang said in a report in March.

-- With assistance from Joyce Koh in Singapore and Chiara Remondini in Milan. Editors: Barry Porter, Anand Krishnamoorthy

To contact the reporters on this story: Elffie Chew in Kuala Lumpur at echew16@bloomberg.net; Mark Lee in Hong Kong at wlee37@bloomberg.net

To contact the editors responsible for this story: Philip Lagerkranser in Hong Kong at lagerkranser@bloomberg.net; Young-Sam Cho in Tokyo at ycho2@bloomberg.net.

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