Ooredoo Said to Consider Sale of Stake in Owner of StarHub

  • Qatari company working with HSBC to gauge investor interest
  • Phone carrier wants to focus on core Middle East market

Ooredoo QSC, the Qatari-owned phone carrier, is considering selling its indirect stake in Singapore’s StarHub Ltd., according to people with knowledge of the matter.

The company is working with HSBC Holdings Plc to gauge potential interest in its stake in Asia Mobile Holdings Pte, the people said, asking not to be identified as the process is private. Ooredoo owns about 25 percent of Asia Mobile Holdings, which in turn holds 55.8 percent of StarHub, according to the Singapore-based company’s annual report.

Ooredoo, with operations in Southeast Asia spanning Indonesia to Myanmar, wants to sell the asset to focus on its core Middle East market and on faster-growing markets, two of the people said. Singapore is planning an auction of additional frequencies this year to enable the entry of a fourth mobile carrier, with the introduction of competition aimed at boosting innovation in the city-state.

“Telcos are cash-cow businesses in Singapore, that’s the main attraction,” Carey Wong, a Singapore-based analyst at Oversea-Chinese Banking Corp. said by phone Tuesday. “Those people looking to enter Singapore, instead of going on their own, can get a stake in StarHub. It has mobile, broadband and TV, the question is how effective their bundling strategy is.”

A representative for StarHub said in an e-mail it is unable to comment on its shareholder’s behalf, while confirming Ooredoo has about a 14 percent stake via its 25 percent ownership of Asia Mobile Holdings.

StarHub shares closed down 1 percent in Singapore trading Tuesday. Ooredoo fell 0.1 percent on the Doha exchange.

Officials from Singapore Technologies Telemedia Pte, which owns 75 percent of Asia Mobile Holdings, and HSBC declined to comment. Ooredoo didn’t immediately respond to queries. ST Telemedia is a unit of Temasek Holdings Pte, Singapore’s state-owned investment company.

Shares of StarHub, which has a $5 billion market value, have risen 5.7 percent this year, compared with a 1.8 percent gain in the Singapore benchmark Straits Times Index. Led by Chief Executive Officer Tan Tong Hai, the company competes with local rivals Singapore Telecommunications Ltd. and M1 Ltd. to provide mobile, Internet and entertainment services to consumers and businesses.

Japan’s Nippon Telegraph & Telephone Corp. owns 9.9 percent of StarHub, according to the annual report.

Ooredoo invested in Asia Mobile Holdings in 2007. Ooredoo also owns 65 percent of PT Indosat in Indonesia, Bloomberg-compiled data show, and started mobile phone service in Myanmar in 2014.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE