Telkom GMS Will Discuss Indihome Spin-off To Telkomsel, This Is What Management Says

JAKARTA - PT Telkom Indonesia Tbk (TLKM) plans to spin off IndiHome from Telkom. The spin off plan will be discussed at the Telkom Annual General Meeting of Shareholders (AGMS) on May 30, 2023.

This follows up on the Conditional Decoupling Agreement or Conditional Spin-Off Agreement related to Indihome's separation from Telkom on April 6, 2023, which was then merged with Telkomsel.

Based on the company's prospectus, the separation was carried out based on the valuation value of IndiHome which was agreed to be IDR 58.24 trillion. Meanwhile, the value of Telkomsel's valuation was IDR 319.35 trillion.

"The separation of the IndiHome business segment will be completed through the issuance of new shares by Telkomsel to the company with a conversion value per share of Rp1.74 billion," Telkom management wrote, quoted Wednesday, May 24.

Along with the separation, Singtel also decided to also make a capital investment by making a cash deposit to Telkomsel. Capital participation using the same Telkomsel valuation as a reference when the company split it, which was IDR 2.71 trillion.

"Thus, after the effective date of separating the company's share ownership in Telkomsel to 69.9 percent and Singtel's share ownership in Telkomsel to 30.1 percent," he said.

The Company and Telkomsel will also conduct related transactions in the form of providing infrastructure, devices, professional services and supporting network capacity as well as providing fixed broadband core and IT systems services from the company.

The reason is to support the operational activities of the IndiHome business segment in the future and provide transition services to Telkomsel to be able to hold the IndiHome Business Segment independently.

To note, TLKM's share ownership in Telkomsel is 65 percent and the value of the transaction plan. Consisting of the valuation value of the IndiHome business segment which was agreed to be IDR 58.24 trillion.

Then the WSA contract value is IDR 18.74 trillion, the contract value of TSA-1 is IDR 495.97 billion and the contract value of TSA-2 is IDR 489.26 billion. Overall, the value of this transaction is estimated to be greater than 50 percent of the company's equity based on the financial statements on December 31, 2022.

"So in accordance with the definition and limitation of the value of material transactions at POJK 17/2020, the transaction plan is an affiliated transaction for the company, so it requires approval from independent shareholders in the GMS," he said.