Malaysian mobile operator U Mobile targets US$500m IPO

[KUALA LUMPUR] U Mobile, a Malaysian mobile service provider, is planning to raise about US$500 million in an initial public offering (IPO) in Kuala Lumpur, according to people familiar with the matter.

The wireless carrier has asked banks for proposals to help with the potential share sale, the people said. The company is set to pick advisers soon for a listing that could happen as early as the end of 2020, said the people who asked not to be named as the information is private.

Singapore's Straits Mobile Investments is U Mobile's biggest shareholder with 35 per cent stake, according to the company registry. Temasek Holdings, Singapore's state investment firm, holds Straits Mobile through a unit. Other shareholders of U Mobile include Malaysian tycoon Vincent Tan and the ruler of Malaysia's Johor state, who hold 21 per cent and 11 per cent, respectively.

U Mobile, Malaysia's fourth-biggest mobile operator, is set to join home improvement retailer Mr D.I.Y. and bubble tea chain Loob Holding in planning a listing in the country in the coming year.

First-time share sales in Malaysia have rebounded and nearly tripled to US$452 million so far in 2019, from US$164 million for the same period last year. That's still short of the US$1.72 billion of offering seen for the full year in 2017.

"U Mobile is in the process of planning an IPO and we are targeting to go public next year," chief executive officer Wong Heang Tuck said in an emailed response to questions. "However, the exact timing would be largely dependent on market conditions."

U Mobile has 16 per cent of the country's wireless subscription market, behind, Maxis, and Celcom Axiata, according to a 2018 report by the Malaysian Communications and Multimedia Commission.