This article appeared in Soyacincau on 31 August 2022.

Following a report indicating that Maxis and U Mobile have declined to take a stake in Digital Nasional Berhad (DNB), the single wholesale network has issued a statement iterating that other telcos are still interested in the 5G network equity deal.

According to DNB, the execution of Share Subscription Agreements (SSAs) between Mobile Network Operators (MNOs) and Digital Nasional Berhad (DNB) will be concluded soon. It clarified that the SSAs were finalised and ready to be signed on 30th August but there was a last minute change by two telcos despite their earlier confirmation to participate. Without naming the parties, it said one decided not to proceed, while the other telco had not responded.

DNB says the other four telcos (presumably Celcom, Digi, Telekom Malaysia and YTL Communications) remain interested and it is envisaged that the equity participation process will progress to completion with the MNOs concerned.

Due to the latest developments, DNB added that revisions to the transaction documents (SSAs and Shareholder Agreement) need to be made to allow for the equity subscription by four MNOs (instead of six), which consequently require further internal approvals from the four MNOs.

Besides the equity stake in DNB, it added that discussions on the 5G Access Agreements are still progressing with all six telcos on a separate and independent track. DNB says it is still committed to its national 5G network rollout and it currently has approximately 30% population coverage. Despite not having any major telcos onboard, it added that they are still on track to achieve 80% 5G population coverage by 2024.

According to Reuters’ report, both Maxis and U Mobile did not proceed with the deal as they could not see benefits of being a minority share holder in DNB. However, they are still looking forward to seek 5G access through wholesale arrangements.

With two telcos out from the equity deal and adjustments currently being made for just four MNOs, this could mean the four telcos would be taking a stake of 17.5% each, while the Ministry of Finance takes 30%. The biggest question is what happens after Celcom-Digi completes their merger? The new MergeCo would have a combined 35% stake in DNB which is more than the government’s stake.