Competition is heating up in Singapore’s $11 billion telecommunications market, threatening to increase funding costs for potential new entrants.
MyRepublic, a local Internet service provider backed by French billionaire Xavier Niel and Indonesia’s Sinar Mas Group, enlisted Goldman Sachs Group Inc. and DBS Group Holdings to help raise $250 million to support its bid for the new fourth mobile-phone licence, Chief Executive Officer Malcolm Rodrigues said. Consistel, a regional wireless software provider, will "absolutely join" the fray and plans to invest as much as $1.3 billion, Chairman Masoud Bassiri said. It plans a mix of debt and equity funding.
Incumbents Singapore Telecommunications, Starhub and M1 are spicing up their offerings in the past week to defend market share before the license auction this year that will shake up what is already the world’s most-saturated market. While Rodrigues denies the city is engaged in a “price war”, potential creditors will have to gauge that risk.
“This could be a candidate for a high-yield telco issuer in the Singapore dollar bond market,” said Terence Lin, assistant director of bonds and portfolio management in Singapore at consultancy iFAST Corp. “Current incumbents are high investment grade due to their parentage and the stability of the sector‚Äôs revenues. The new entrant doesn’t have such strong parentage, so fundraising will be significantly more costly.”
Bidding for the mobile spectrum, starting at the $35 million reserve price, will begin in the third quarter and an award is due April 2017.
MyRepublic plans to offer an unlimited mobile data plan at $80 a month and a two-gigabyte plan at $8 a month, it said on March 9. SingTel responded by offering to double subscribers’ data for an extra $5.90 a month.
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MyRepublic, a local Internet service provider backed by French billionaire Xavier Niel and Indonesia’s Sinar Mas Group, enlisted Goldman Sachs Group Inc. and DBS Group Holdings to help raise $250 million to support its bid for the new fourth mobile-phone licence, Chief Executive Officer Malcolm Rodrigues said. Consistel, a regional wireless software provider, will "absolutely join" the fray and plans to invest as much as $1.3 billion, Chairman Masoud Bassiri said. It plans a mix of debt and equity funding.
Incumbents Singapore Telecommunications, Starhub and M1 are spicing up their offerings in the past week to defend market share before the license auction this year that will shake up what is already the world’s most-saturated market. While Rodrigues denies the city is engaged in a “price war”, potential creditors will have to gauge that risk.
“This could be a candidate for a high-yield telco issuer in the Singapore dollar bond market,” said Terence Lin, assistant director of bonds and portfolio management in Singapore at consultancy iFAST Corp. “Current incumbents are high investment grade due to their parentage and the stability of the sector‚Äôs revenues. The new entrant doesn’t have such strong parentage, so fundraising will be significantly more costly.”
Bidding for the mobile spectrum, starting at the $35 million reserve price, will begin in the third quarter and an award is due April 2017.
MyRepublic plans to offer an unlimited mobile data plan at $80 a month and a two-gigabyte plan at $8 a month, it said on March 9. SingTel responded by offering to double subscribers’ data for an extra $5.90 a month.
Click Here To Register For Free Trial Services OR Give A Missed Call : +6531581402 Follow Us On Twitter : www.twitter.com/epicresearchsg Like Us On Facebook : www.facebook.com/EpicResearchSingapore Need Any Assistance Feel Free To Mail Us at : info@epicresearch.sg
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