Axiata's XL to Embark on a Rights Issue of USD 300 Million


Kuala Lumpur, 4 August 2009, Axiata Group Berhad's (formerly known as TM International Berhad) (“Axiata”), PT Excelcomindo Pratama Tbk (“XL”), one of the leading cellular operators in Indonesia, today announced its plan to embark on a rights issue to raise gross proceeds of approximately USD 300 million. The primary objective of the capital raising is to delever XL's balance sheet in order to maintain financial flexibility and maintain a strong balance sheet and credit profile. The amount being raised is consistent with the amount required for XL to sufficiently delever and to ensure that the company is fully equipped for long term growth.

Dato' Sri Jamaludin Ibrahim, President and Group Chief Executive Officer of Axiata commented, “As the largest shareholder, we are obviously committed to the long term growth of XL and definitely believe in its potential. This financing process demonstrates Axiata's full support and backing to XL, and will provide XL the financial ability to continue investing in its business and to continue strengthening its market position.”

Hasnul Suhaimi, the President Director of XL said: “With the financing, XL will be able to reduce debt and improve our capital structure, thus preserving our flexibility to continue investing in the business. Our operating performance has been strong - in 2008 we grew both revenues and EBITDA by almost 50%. We are pleased that our major shareholders share our positive view of the business and its potential, and as such, they have committed to this USD 300 million rights issue. With our strengthened balance sheet and investment ability, XL will be able to further improve our competitive strengths going forward and continue driving such stellar growth and allow us to distribute dividends to our shareholders in the future”.

The Rights Issue

The rights issue size will be USD 300 million which will consist of equity and mandatory convertible notes (“MCNs”). The size of equity and MCN, final issue price of the common shares and conversion price of MCN will be determined later and released at a later date.
To demonstrate their continued commitment as major shareholders of XL, Axiata and Emirates Telecommunications Corporation International Indonesia Ltd have both agreed to fully subscribe to their rights entitlement under the rights issue.

Use of Proceeds and Rationale

The proceeds from the rights issue will be used principally to repay debt. This will allow XL to reduce its financing costs, improve its capital structure and therefore provide XL the balance sheet strength to continue investing for growth.

Future Plans

Dato' Sri Jamaludin Ibrahim added “With regards to our future plans, Axiata remains committed to increase the free float when market conditions improve”.

Shareholder Approval and Timing

Subject to approval at the Extraordinary General Meeting of Shareholders (“EGMS”) of XL to be held sometime this year, the rights issue is planned to be completed in Q4 2009.


About Axiata


Axiata is one of the largest Asian telecommunication companies, focused in high growth low penetration emerging markets. Axiata has controlling interests in mobile operators in Malaysia, Indonesia, Sri Lanka, Bangladesh and Cambodia with significant strategic stakes in India, Singapore and Iran. India and Indonesia are amongst the fastest growing markets in the world. In addition, the Malaysian grown holding company has stakes in non mobile telecommunication operations in Thailand and Pakistan.

The Group's mobile subsidiaries and associates operate under the brand name ‘Celcom' in Malaysia, ‘XL' in Indonesia, ‘Dialog' in Sri Lanka, ‘AKTEL' in Bangladesh, ‘HELLO' in Cambodia and ‘Idea' in India, ‘M1' in Singapore and ‘MTCE' in Iran (Esfahan).

As of December 2008, The Group's, including its subsidiaries and associates, has over 90 million mobile subscribers in Asia. The Group revenue for 2008 was RM11.3 billion. The Group provides employment to over 25,000 people across Asia. Axiata's vision is to be a regional champion by 2015 by piecing together the best throughout the region in connectivity, technology and people, uniting them towards a single goal: Advancing Asia.

Axiata was awarded the Frost & Sullivan 2009 Asia Pacific ICT Award for Best Telecom Group.

About XL

XL is a major cellular provider in Indonesia which is majority owned by Axiata through Indocel Holding Sdn Bhd (83.8%). The remaining stakes are held by Emirates Telecommunications Corporation International Indonesia Ltd, a wholly-owned subsidiary of Etisalat (16%), and the public (0.2%).