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Etisalat said it would buy a 16 per cent of PT Excelcomindo Pratama TBK for $438m (Dh1.6bn) to enter Indonesia, the world's fourth most populous country.
Etisalat will buy 1.13 billion shares in Indonesia's third-largest telecoms firm from Rajawali Group in a deal that could close as early as this month, the UAE-based operator said in a statement.
Excelcomindo is a 67 per cent owned unit of Telekom Malaysia whose third-quarter profit jumped 37.5 per cent, largely driven by growth in its home market and Indonesia.
Etisalat, the second-largest publicly traded Arab telecom firm with operations in 16 countries including Pakistan, said it wanted to gain exposure to the fast-growing telecoms market in Indonesia, home to 226 million people.
“This investment represents an important step for Etisalat's international expansion strategy into Asia," Etisalat Chairman Mohammad Omran said in a statement.
Excelcomindo expected to have up to 14m mobile phone users in Indonesia by the end of the year, up from 10.5m at the end of July, its president said in September.
The company has 13m subscribers and market share of 14 per cent at the end of September, Etisalat said.
Indonesia's telecoms sector has attracted several new entrants. Telekom Malaysia said in April it had bought 7.4 per cent of Excelcomindo, raising its stake in the Jakarta-based operator to 67 per cent.
Khazanah Nasional Berhad, an investment arm of the government of Malaysia, owns 16.8 per cent in Excelcomindo.
Etisalat will be able to nominate one member to Excelcom's board, it said. (Reuters)
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