Indonesia’s Telkomsel is reportedly planning to sell further tower assets to Mitratel, the tower unit of its parent firm Telkom Indonesia.
Mitratel raised US$1.3 billion via an IPO in November, and according to Bloomberg now plans to use most of this to acquire an additional 4000 tower sites from Telkomsel – as well as other operators. Telkom Indonesia’s President Director Ririek Adriansyah noted that the firm could also acquire a fibre company with existing assets in order to meet data demand, which is booming in Indonesia.
“Indonesia is a tough market so we need to be efficient,” said Adriansyah. “We need to manage the quality and we need to differentiate ourselves so we’re not trapped in the price war.”
During 2020, Mitratel acquired 6050 sites from Telkomsel, and in September this year it obtained a further 4000 for IDR6.2 trillion ($431.4 million). Telkom Indonesia believes that having a large tower network will position the operator well to compete against rivals XL Axiata and Indosat Ooredoo – the latter of which is currently merging with Hutchison 3 Indonesia to create a new entity with around 100 million subscribers.
Indonesia claims the third-cheapest average data rates in Asia (after Sri Lanka and Bangladesh) at $0.42 per GB. It is fast becoming one of the largest markets globally for e-commerce and mobile financial services, with its digital economy on track to reach US$146 billion by 2025, according to a report by Google, Temasek Holdings and Bain & Co.