IndiHome Merged into Telkomsel, Its valuation is Rp. 58 trillion

IndiHome, a business unit owned by PT Telkom Indonesia Tbk (IDX: TLKM), is ready to be merged with PT Telekomunikasi Selular (Telkomsel) through the signing of a Conditional Spin-Off Agreement on April 6, 2023. Telkom will combine services fixed broadband and mobile broadband (cellular) into one business entity.

IndiHome's merger action includes internet services, voice bundling (including voice only with access homewifi), IPTV, OTT, digital services, and all their customers to Telkomsel.

"Based on the Conditional Separation Agreement, the value of the IndiHome business segment to be separated is IDR 58,2 trillion," said Telkom VP Investor Relations Edwin Sebayang in an information disclosure on the IDX, Thursday (6/3).

As part of this separation plan, Telkom and Telkomsel Sign a Wholesale Agreement commercial agreement regarding the provision of infrastructure and services fixed broadband core, and IT services system. Meanwhile, this corporate action has received approval from the General Meeting of Shareholders (GMS) of both Telkom and Telkomsel.

Singapore Telecom Mobile Pte Ltd (Singtel) will also increase its share ownership in Telkomsel around 0,5 points to 30,1% by paying IDR 2,7 trillion. According to reports Reuters, The transaction is targeted to be completed in the third quarter of 2023. Currently, IndiHome controls 75,2% of the market share broadband in Indonesia.

"The release of this business unit was carried out to maintain Telkom's competitiveness and superiority in facing business competition in the Indonesian telecommunications sector. Likewise, to accelerate the process of equalizing services broadband,added Edwin.

In interview with DailySocial.id Last year, Telkom's Director of Digital Business, M. Fajrin Rasyid, previously admitted that he did not know about the merger plan considering that IndiHome was in the Consumer Directorate, different from the Division.

"However, the digital strategy will follow the business. What is certain is that one of the premises is the collaboration between IndiHome and products Telkomsel "It will be better with this merger," said Fajrin.

Based on Telkom's performance as of December 31, 2022, users Telkomsel recorded at 156,8 million subscribers, while IndiHome users were around 9,2 million subscribers.