KUALA LUMPUR (Aug 23): Telekom Malaysia Bhd (KL:TM) said on Friday an agreement to buy a stake in Digital Nasional Bhd (DNB) was terminated, after its request for additional time to seek shareholders’ approval was declined.

The company asked DNB, the special purpose vehicle building the country’s first 5G network, for an extension last month, which was not approved, and an appeal later was also denied, TM said in an exchange filing. DNB issued a notice on the termination of the share subscription agreement on Friday.

“This turn of event does not affect TM’s current 5G offerings to customers, as its 5G wholesale service subscription from DNB remains in place,” the company said in a statement.

In June, four mobile network operators — CelcomDigi Bhd (KL:CDB), Maxis Bhd’s (KL:MAXIS) Maxis Broadband Sdn Bhd, the unlisted U Mobile Sdn Bhd and YTL Power International Bhd (KL:YTLPOWR) — had completed their share subscription agreements and acquired a 16.3% stake each in DNB.

The individual stake is higher than the 14% they were initially expected to take up, as TM had yet to complete its part of the deal. TM had to seek shareholders’ approval in an extraordinary general meeting (EGM), as the share subscription agreement would be a related party transaction.

The long-stop date, or the ultimate deadline, given by DNB to TM was Wednesday, Aug 21. However, TM said it required more time beyond the date to address matters related to the EGM to be held.

“TM will continue to play a key role in supporting the nation’s 5G ecosystem and transition to the 5G dual network, ensuring that the nation benefits from the latest advancements in connectivity and digital services,” it said.

Further, the tenure of its nominee director, Nik Azli Abu Zahar, on the board of DNB has accordingly ceased, according to TM.