Bangkok--29 May--MT Multimedia
DIF announced its intention to make the fourth round of investment in telecommunications infrastructure assets and finance them by raising up to THB 15.8 billion through an offering of up to 1.050 billion newly issued units to the existing unitholders and, for that purpose, to hold EGM #1/2019 on June 21.
Mr. Narongsak Plodmechai, Chief Executive Officer (CEO) of SCB Asset Management Co. Ltd., as the management company of Digital Telecommunications Infrastructure Fund ("DIF" or "Fund"), revealed that DIF, Thailand's first and largest telecommunications infrastructure Fund that invests in telecommunications infrastructure assets (e.g., telecommunications towers, fiber optic cable – or FOC transmission equipment, broadband system) on a national scale, is looking to make the fourth round of investment in infrastructure assets with a combined value of up to THB 15.8 billion, in line with its strategy to create continuous growths. He noted that DIF is committed to exploring opportunities to invest in infrastructure assets and increasing the value of the assets in its portfolio in order to reap benefits and grasp the opportunities to generate investment returns to the unitholders in the long run, to tap growth in the highly competitive telecommunications industry, which is entering the 5G era, and to cope with the demand for Internet services that has kept rising.
DIF currently owns and holds the right to net revenue from 15,271 telecommunications towers. It also owns and holds long-term leasehold interests in and the right to net revenue from approximately 2.7 million core kilometers of OFC. Moreover, it owns an upcountry broadband system with a capacity of 1.2 million ports. Its net asset value as of March 31, 2019 stood at THB 150.2896 billion.
The CEO said telecommunications infrastructure assets of True Group in which DIF will invest in its fourth round of additional investment comprise the following:
1. Ownership of 749 telecommunication towers on ground and approximately 39 telecommunication towers on building rooftops, totaling 788 towers, all of which are ready for use and most of which are no more than one year old.
2. Ownership of fiber optic cables (FOC), which are currently used for the provision of mobile phone services in upcountry provinces, with a distance of 1,795 kilometers (or about 107,694 core kilometers).
3. Ownership of FOC, which are currently used to support the FTTx technology for the provision of Internet and broadband Internet services in Greater Bangkok, and upcountry provinces, with a total distance of approximately 315 kilometers (or approximately 40,823 core kilometers) and approximately 617 kilometers (or approximately 37,505 core kilometers), respectively.
4. Ownership of FOC, which are currently used to support the FTTx technology for the provision of Internet and broadband Internet services in upcountry provinces, with a total distance of 2,797 kilometers (or about 109,704 core kilometers).
Due to the fourth round of additional investment in telecommunications infrastructure assets, the Cash Distribution Per Unit (DPU) of DIF after the investment is expected not to be lower than the expected DPU in cases where DIF did not make the fourth round of additional investment, as estimated by the management company and reviewed by an auditor licensed to make estimates for the period starting from October 1, 2019 to September 30, 2020.
The only source of funds to be used in the investment will be from an increase in registered capital. DIF will increase its registered capital in an amount of no more than THB 10,500,000,000, from THB 96,379,430,540, with a par value of THB 10, to THB 106,879,430,540. The number of newly issued units, which will be issued and offered proportionately to the existing shareholders whose names appear on the share register book, will not exceed 1.05 billion units. The offering will be subsequently scheduled.
DIF will propose this plan for approval at Extraordinary General Meeting (EGM) of Digital Telecommunications Infrastructure Fund Unitholders No. 1/2019, to be held on June 21, 2019, from 09:30 a.m. onwards, at the Grand Ballroom, on the second floor of Shangri-La Hotel, Bangkok. A list of unitholders eligible to attend the meeting will be specified on May 28, 2019 (Record Date).
Miss Veena Lertnimitr, Executive Vice President of Primary Distribution Division of The Siam Commercial Bank PLC, as the Financial Advisor, added that the fourth round of investment would enhance DIF's revenue-generating capacity and potential and the geographical diversification of the Fund's assets and that it would allow the Fund to better handle the growing telecommunications and Internet industries in Thailand. She said that it would also improve trading liquidity for the Fund's units as well as the chance that the unitholders would enjoy decent long-term returns.
For the past three years (2016-2018), DIF consistently distributed its returns to the unitholders, achieving annualised DPU rates (as calculated from quarterly figures) of THB 0.956, THB 0.975 and THB 1.016 per unit. Respectively. With the fourth round of investment, the Fund is projected to acquire benefits from the main targets of additional investment through long-term leases to the main lessee, i.e., True Group, presently a major telecommunications service provider in Thailand.