Axiata plans for share sale proceeds

AXIATA Group Bhd (6888), one of the largest Asian telecommunication companies, says it is likely to use part of proceeds from the sale of shares in its Indonesia-based subsidiary to reduce debts and as dividend to shareholders.

"We are looking at a few possibilities. One of it is a special dividend or we make it as part of a long-term dividend, or we pare down our debts.

"What we are more inclined at this point in time, is a combination of the latter two. This means, we will pare down the debts and at the same time, build enough cash accumulation, so that we can give shareholders a good progressive dividend," said president and group CEO Datuk Seri Jamaludin Ibrahim on the sidelines of Invest Malaysia 2010 in Kuala Lumpur yesterday.

Axiata said last week that it plans to raise as much as RM2 billion by selling a 20 per cent stake in PT XL Axiata Tbk (XL). The share sale would reduce its shareholding to 66 per cent.
The company also expects its local unit Celcom Axiata Bhd to continue to grow faster than the industry this year, despite increasing competition from rivals.

"We expect Celcom's growth to still be good, we want to grow faster than the industry. Based on research, the industry is expected to grow by 5 per cent. I think we want to do better than that," said Jamaludin.

Celcom chief executive officer Datuk Seri Shazalli Ramly said that the company is well prepared to grow in the first quarter, which traditionally the weakest quarter of the year.

"First quarter is traditionally the weakest quarter, due to less working days as a result of festive seasons, but nevertheless, we were prepared. We have launched several initiatives, such as the Celcom Sale," said Shazalli.

He declined to comment if the company can continue its consecutive quarterly revenue growth momentum. Celcom, the country's second largest mobile operator, gained the most market share last year. It managed to grow 15 consecutive quarterly revenue and earnings growth.