Etisalat may sell XL Axiata stake

Dylan Bushell-Embling
14 Mar 2012
00:00

The UAE's Etisalat is reportedly shopping for a buyer for its 13.3% stake in Indonesia's XL Axiata, in a bid to raise between $600 million and $700 million this year.

Sources close to the deal told Reuters that Etisalat has been considering selling out of the operator for months, because of tensions with the venture's majority owner, Malaysia's Axiata.

XL Axiata is Indonesia's third largest mobile operator. It has a current market capitalization of around $4.3 billion.


As of the end of 2011, XL Axiata had around 46 million total subscribers, and the operator expects that figure to reach 50 million this year.

Etisalat bought into the operator for $440 million in 2007, but the maturation of the Indonesian mobile market has made it less attractive to foreign investors.

XL Axiata reported a 2.1% decline in net profit for 2011 to 2.86 trillion rupiah ($311.7 million), despite a 7.3% increase in revenue.

Etisalat has already exited one Asian venture this year. The operator and Indian partner DB Group elected to wind down 2G joint venture Etisalat DB last month following the cancellation of its 2G license.

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