KUALA LUMPUR (April 20): Digital Nasional Bhd (DNB), the operator of Malaysia’s 5G telecommunications assets, said the process in relation to the subscription of its shares by five mobile network operators (MNOs) in this country is ongoing.

“The process with respect to the share subscription agreements (SSAs) signed with the five mobile network operators (MNOs) is ongoing,” it said in a statement.

“We strongly deny the claims made otherwise but are unable to comment in specific terms due to confidentiality restrictions. Given DNB’s position as a public utility serving the public interest, it is critical for published reports to be verified and based on accurate information,” it said.

DNB issued the statement in response to a news article which reported that negotiations for the share subscription had broken down.

The SSAs were executed in December between DNB and the MNOs — CelcomDigi Bhd through Infranation Sdn Bhd, Maxis Broadband Sdn Bhd, U Mobile Sdn Bhd, Telekom Malaysia Bhd and YTL Power International Bhd’s unit YTL Communications Sdn Bhd — for the five to take up an equity stake in the entity.  

The SSAs essentially give the MNOs a collective 70% equity stake, or 14% each, in DNB, with the government, through the Minister of Finance (MOF) Inc, retaining the remaining 30% and holding a special share. MOF Inc may eventually exit DNB with only a special share. The agreements will also see each MNO inject RM233 million — which amounts to a total of RM1.165 billion — to meet DNB’s funding requirements.

In the statement, DNB said it “strongly denies” allegations of non-transparency in its internal operations with regards to the awarding of contracts to third party vendors, in particular for Ericsson’s 5G network equipment, software procurement and “a potentially lucrative cloud services platform”.

It also “rejects the insinuation of any impropriety in [its] governance and procurement practices”.

“DNB’s tender and procurement processes are structured according to the strictest governance standards and best practices. DNB has always been open and transparent in its awarding of tenders and contracts — this matter has been addressed in detail various times in Parliament and reported in the media, repeatedly disproving the allegations,” it said.

“DNB remains focused on continuing to deliver one of the best-performing and most reliable 5G networks in the world on an accelerated basis and within cost, and on increasing 5G adoption across industries, enterprises and the public, to help accelerate Malaysia’s digital transformation,” the network infrastructure operator said.

Within DNB, its chief executive officer position remains vacant after Augustus Ralph Marshall left in March 2023 when his two-year contract expired. It was reported that DNB has reached more than 80% coverage of populated areas to date, with nearly 10 million people having subscribed to 5G services at the end of January, representing an adoption rate of nearly 30%.