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SingTel to sell stake in loss-making Warid
(Technology Times (Pakistan) Via Acquire Media NewsEdge) Singapore Telecommunications Ltd. (Z74.SG), Southeast Asia’s biggest mobile phone company, has announced to sell all of its 30 per cent stakes in Pakistan’s Warid Telecom (Pvt) Ltd.
The company will take an estimated loss of about 230 million $186 million on the transaction. SingTel had been looking to sell the stake in the loss-making company since July when it reclassified Warid as an ‘asset held for sale’ and ceased accounting for its stake in the operator.
The planned sale to Abu Dhabi’s Warid Telecom Pakistan LLC will bring to a close an investment that never generated returns for SingTel since it paid $758 million in 2007 to buy the stake, then describing the operator as a ‘natural fit’ for itself.
As a part of the deal, SingTel will receive $150 million in cash and a 7.5 per cent share of proceeds from any future sale or public offering of Warid, according to the company’s statement to the Singapore Exchange.
“The sale of SingTel’s stake in Warid follows a strategic review of the investment, its competitive position and opportunity,” SingTel said in the statement without elaborating.
SingTel’s net profit in the quarter that ended Sept. 30 was 1.6 per cent lower than in the previous year at S$868 million. The company will report earnings for its fiscal third quarter on February 14.
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