The Singapore Telecommunications (Singtel) logo outside a building in Singapore on February 12, 2016.
Roslan Rahman | AFP | Getty Images
Southeast Asia’s largest telecom operator Singtel has sold a 2.8% stake in Thailand’s largest energy company Gulf Development for about S$1 billion ($772.9 million) to raise cash for new investments.
The shares will be sold directly to institutional investors and are expected to generate an equity gain of approximately S$140 million, Singtel said in a statement on Tuesday.
Following the transaction, Singtel will own a 4.95% stake in Gulf Development Limited, worth approximately S$1.8 billion.
Arthur Lang, Singtel’s Group Chief Financial Officer, said: “This sale highlights Singtel’s concerted efforts to optimize our portfolio as we continue our disciplined approach to capital management.”
Mr Lang said Singtel’s partnership with Gulf Development remains strong and Thailand remains an important market for the company.
The sale comes as Singtel increases investments in growth areas. The company expects capital expenditure to reach about S$3 billion in the current financial year, up from S$2.5 billion in the same period last year.
“The $1.2 billion is actually earmarked for the growth from data center to AI, which is our GPU as a service for the region, specifically the provision of sovereign AI services for Singapore,” Singtel CEO Yuen Kuan Moon told CNBC’s “Squawk Box Asia” in May.
Singtel shares last traded at S$4.30, down 1.38%.
