Axiata’s Link Net Considering Sale of Stake in Indonesia Fiber Business

Manuel Baigorri and Elffie Chew, Bloomberg News

Signage for Axiata Group Bhd. at the company's headquarters in Kuala Lumpur, Malaysia, on Monday, July 3, 2023. Axiata Group, Malaysia’s biggest wireless carrier by revenue, plans to sell stakes in some of its businesses and list its technology units to reduce debt taken to fund the acquisition of telecom assets overseas. Photographer: Samsul Said/Bloomberg , Bloomberg

(Bloomberg) -- Indonesian internet provider PT Link Net is considering selling a stake in its fiber business to raise as much as $500 million to fund an expansion, according to people with knowledge of the matter.

The unit of Axiata Group Bhd., Malaysia’s biggest wireless carrier, is seeking an adviser to help with a potential sale, which could raise $400 million to $500 million, the people said, asking not to be identified discussing private information.

Considerations are preliminary and Link Net could decide against a deal, the people said. Link Net declined to comment.

A representative for Axiata said Link Net requires capital to accelerate its “fiber build,” but didn’t provide details on the size of the potential fundraising. “Amongst many sources of capital, inviting investors to partner with us in this growth opportunity is one such source,” the spokesperson said.

Axiata Group’s shares jumped 3.5% Monday morning, touching the highest in five months.

Read More: Malaysia’s Axiata Is Said to Weigh Options for Indonesian Units

As part of a non-binding deal in December, Link Net agreed to transfer its fixed broadband business to Indonesian mobile operator PT XL Axiata.

Link Net has a market value of about 3.5 trillion rupiah ($224 million). Its share price has fallen 43% over the past 12 months. XL Axiata rose 2.5% Monday.

--With assistance from Fathiya Dahrul.

(Updates share price moves in fifth and seventh paragraphs.)