PE consortium, strategics proceed in Optus bidding – report

According to Bloomberg, final offers are due next month.

SingTel is seeking more than A$2 billion ($1.8 billion) for the business, which posted an EBITDA for A$225 million for 2012. Credit Suisse and Morgan Stanley were hired by SingTel in March to consider sale options and they are said to be willing to provide leveraged financing to the successful bidder at 7x Optus Satellite's EBITDA.

Optus Satellite provides television, radio, phone, internet data and military signals to Australia, New Zealand and the Antarctic. It broadcasts signals to more than two million Australian households and companies and will launch a sixth satellite this year, according to SingTel. Its customers include state-owned Australian Broadcasting Corp. and Australia's Department of Defence.

SingTel, which is controlled by Temasek Holdings, acquired the business as part of the $9.69 billion takeover of Optus, Australia's second-largest phone company, in 2001.

Divesting Optus Satellite would help finance the S$2 billion ($1.6 billion) of acquisitions that SingTel is planning to offset slowing sales in Australia and Singapore.

Optus is 100%-owned by SingTel and contributed 45% of the company's funds from operations in the 2013 fiscal year. Fitch Ratings expects Optus' 2014 revenue to decline - but by less than 10% - while absolutee EBITDA remains flat due to cost-saving measures and lower subscriber acquisition cost as it reduces handset subsidies.

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• Topics
• Australasia
• Southeast Asia
• Temasek Holdings
• TPG Capital
• The Blackstone Group
• Australia