SingTel to sell infrastructure assets to business trust

25-Jul-2011 Intellasia | Channelnewsasia | 7:01 AM Print This Post

SingTel plans to inject S$1.89 billion worth of infrastructure assets into a business trust called NetLink Trust, which it solely owns.

The assets under sale consideration include ducts and manholes used by OpenNet, which is the operating company (OpCo) in charge of laying optical fibre cables for Singapore’s Next Generation Nationwide Broadband Network (NGNBN).

The deal also includes seven exchange buildings.

The trustee-manager for NetLink Trust is CityNet Infrastructure Management, a wholly-owned subsidiary of CitySpring Infrastructure Trust.

CityNet will receive an annual management fee of approximately S$2.1 million.

The sale consideration will be financed by way of a unitholder loan from SingTel to CityNet in its capacity as trustee-manager of NetLink Trust, and the issue of units in NetLink Trust to SingTel.

The sale is part of the government’s requirements for the telco to eventually divest NGNBN-related assets to an independent asset company by mid-2011 and sell down its stake in that entity by 2014.

SingTel will retain a 100 per cent economic interest over the business and assets of NetLink Trust as the sole unitholder of NetLink Trust.

The telco will incur additional costs for the operation and maintenance of NetLink Trust.

It said such costs are currently not expected to exceed S$20 million per year.

SingTel added that the above transactions do not have a material impact on the group’s net assets or net profit in the current financial year.

http://www.channelnewsasia.com/stories/singaporebusinessnews/view/1142479/1/.html

 


Category: Singapore

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