KUALA LUMPUR (Dec 5): Singapore Technologies Telemedia Pte Ltd (ST Telemedia) announced on Wednesday in Singapore that its unit, Straits Mobile Investments Pte Ltd, has entered into an agreement to sell “a majority stake” in U Mobile Sdn Bhd.

It further said that on completion of the transaction, Straits Mobile will hold a minority stake of approximately 20% in U Mobile, and that U Mobile will cease to be its subsidiary.

The buyer of the stake is Mawar Setia Sdn Bhd — a company owned by Tan Sri Vincent Tan and Johor princess Tunku Tun Aminah Sultan Ibrahim. Mawar Setia was incorporated in April this year and is 70%-owned by Tan and 30% by Tun Aminah based on information retrieved from the Companies Commission of Malaysia (SSM). Tun Aminah is the only daughter of Malaysia’s King, Sultan Ibrahim.

The statement made no mention of the value of the stake to be sold.

The ST Telemedia statement that the stake to be sold was “a majority stake” and that after the sale it would still “hold a minority stake of  20%” in U Mobile has, however, created some confusion over the actual size of the stake held by Straits Mobile.

According to the latest SSM data, Straits Mobile has a 48.25% stake in U Mobile. While that makes it the largest shareholder, it is not a majority stake — which must be at least 50% plus one share. Furthermore, the statement said Straits Mobile will retain a 20% stake in U Mobile after the transaction. This means that if Straits Mobile was selling only 28.25%, why did the statement say that it was selling a majority stake? Or does Straits Mobile actually own more than the 48.25% disclosed to SSM?

At present the King, Sultan Ibrahim, is U Mobile's second largest shareholder with 22.3%. Among its other shareholders are: Magnum Bhd at 7.83%, Singer (Malaysia) Sdn Bhd at 6.09%, U Telemedia Sdn Bhd at 5.59% and Tan Sri Koon Poh Keong at 2.35%, based on the latest SSM data. Singer and U Telemedia are Tan's vehicles.

Tan had previously defended the king's stake ownership in U Mobile, which has been selected to lead the development of the country's second 5G network, saying he has been holding shares in the telecommunications company since 2015, long before he became the king.

Meanwhile, the proposed transaction is subject to the satisfaction of certain conditions precedent, including the receipt of regulatory approvals, said ST Telemedia in its Wednesday statement. The deal's completion is expected to be no later than the third quarter of 2025.

ST Telemedia also said a supplemental letter agreement will be entered into between Mawar Setia, Straits Mobile and STT Communications — a direct wholly owned unit of ST Telemedia and the sole shareholder of Straits Mobile — in respect of amendment to certain rights and obligations of the parties under the shareholders' agreement.