Singtel Weighing Options for Australia Optus Fiber Assets, Sources Say

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(Bloomberg) — Singapore Telecommunications Ltd. is considering options including a potential stake sale in the fiber assets of its Australian subsidiary SingTel Optus Pty, people familiar with the matter said, a deal that would follow last year’s disposal of its mobile phone towers unit.

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Singtel, as the Singaporean phone-services provider is known, has held talks with potential advisers to prepare for a strategic review of the Australian fiber business, the people said, asking not to be identified because the information is private.

Options for the assets, which could be worth a few billion dollars, include a potential stake sale, partnership with an investor or a sale and lease back, the people said. Deliberations are preliminary and there’s no certainty that the review will lead to a transaction, the people said.

A representative for Singtel declined to comment.

A deal would help Singtel raise cash and boost growth amid increasing investor demand for digital infrastructure businesses, the people said. In October, the company sold a majority stake in the mobile phone towers unit of Optus to pension manager AustralianSuper Pty for about A$1.9 billion ($1.4 billion).

Shares of the carrier jumped as much as 3.4% in Singapore on Tuesday, their biggest intraday gain in five months.

Singtel, which offers mobile, broadband and TV services as well as business-oriented solutions for companies, has a presence across Asia, Australia and Africa. In the half year ended Sept. 30, Singtel’s earnings before interest, tax, depreciation and amortization rose 1% to S$1.93 billion ($1.4 billion), while revenue grew 3% to S$7.65 billion. In Australia, Optus reported Ebitda climbed 5%, boosted by its mobile business.

Under a strategic review kicked off by group Chief Executive Officer Yuen Kuan Moon in May, the company has been sharpening its focus on unlocking value in its infrastructure assets and bolstering its data-center platform.

(Updates with shares in sixth paragraph.)

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