Investors

(Unless otherwise stated, the exchange rate of United States Dollar (“USD”) 1.00: Ringgit Malaysia (“RM”) 4.3355 being the middle rate prevailing as at 3 pm on 15 May 2017 as published by Bank Negara Malaysia, has been applied in this announcement for illustration purposes)

1.0       INTRODUCTION

Axiata Business Services Sdn Bhd (“ABS”), a wholly owned subsidiary of Axiata Group Berhad (“Axiata”), had on 15 May 2017 entered into a Share Sale and Purchase Agreement (“SSPA”) for the acquisition of 65% of the issued share capital of Suvitech Co., Ltd (“SCL”) at a consideration of up to USD11.05 million (equivalent to RM47.91million) (“Purchase Price”) (“Proposed Acquisition of SCL”).

2.0       INFORMATION ON ABS AND SCL

• ABS

ABS was incorporated in Malaysia on 29 July 2016 with an authorised and paid-up capital of RM1,000,000 which consists of 1,000,000 ordinary shares. The principal activity of ABS is provision of international carrier services, global communications products, managed information, communications and technology, and internet of things (“IoT”).

• SCL

SCL was incorporated in Kingdom of Thailand on 10 May 2002 with authorised and issued share capital of THB100,000,000 which consists of 10,000,000 ordinary shares. SCL is the owner and operator of a mobile virtual network enabler (“MVNE”) platform to facilitate the provision of sales/dealer management, products/pricing and provisioning, and billing for consumer, enterprise and IoT services.

3.0       SALIENT TERMS OF THE SSPA

The salient terms of the SSPA between ABS and the sellers; namely, Mr Chaikorn Boonlapapat (“Seller 1”), Mrs Amornchit Bhatia, Star Pacific Holdings Limited (“Seller 2”), Subin Bhatia and Renu Bhatia (collectively referred to hereafter as “Sellers”. ABS and the Sellers are referred to hereafter as “Parties”) are as follows:-

i) ABS will pay the Purchase Price in cash comprising the following:-

a) USD9.1 million for 6,500,000 ordinary shares (“Sale Shares”) in the share capital of SCL (“First Instalment”). First Instalment shall be adjusted taking into consideration net indebtedness and actual working capital of SCL (“Completion Accounts”); and

b) USD1.95 million upon fulfillment of certain milestones as agreed by the Parties by the end of the retention period, being 12 months from the date of the Completion Accounts.

ii) The Sale Shares shall be acquired free from any encumbrances, claims or other third party rights; and

iii) The closing of the transaction shall be subject to satisfaction of, inter-alia, the following key conditions within 5 months from the date of the SSPA (unless extended by the Parties):-

a) Incorporation of a wholly-owned private limited company in Labuan as a vehicle for ABS’ investment in SCL (“ABS Labuan”);

b) Entry into a shareholders’ agreement between ABS Labuan, Seller 1 and Seller 2 to govern their relationship in SCL; and

c) Receipt by ABS of an approval from Bank Negara Malaysia to permit the investment in SCL as stipulated in the SSPA.

4.0       RATIONALE

The Proposed Acquisition of SCL is both strategic and synergistic for ABS as SCL’s platform is a plug and play solution for ABS enterprise and IoT business in Thailand. SCL’s MVNE business also fits perfectly into the mobile virtual network operator/enabler (“MVNx”) strategic pillar of ABS and will provide solid grounds for future growth. SCL’s MVNE platform is fully integrated with a major mobile network provider in Thailand, providing full suite services to a mobile virtual network operator (“MVNO”). The MVNE platform can also be customized to suit the needs of customers.

5.0       SOURCES OF FUNDS

The Proposed Acquisition of SCL will be funded through internally generated funds.

6.0       FINANCIAL EFFECTS

The Proposed Acquisition of SCL will not have any impact on the issued and paid up share capital of Axiata and will not have any material impact on the earnings, gearings and net assets of the Axiata Group for the financial year ending 31 December 2017.

7.0       APPROVAL OF SHAREHOLDERS

The Proposed Acquisition of SCL is not subject to the approval of the shareholders of Axiata.

8.0       DIRECTORS’ AND MAJOR SHAREHOLDERS’ INTEREST

None of the Directors and major shareholders of Axiata and/or persons connected to them have any interest direct and/or indirect in the Proposed Acquisition of SCL.

This announcement is dated 15 May 2017.