Tycoon Ananda Krishnan exploring pay-TV IPO

UPDATED @ 04:54:02 PM 29-03-2012

March 29, 2012

Ananda Krishnan. — File photo

KUALA LUMPUR, March 29 — Tycoon Ananda Krishnan is exploring proposals from investment banks to list Astro All Asia Networks after the country’s sole satellite pay-TV monopoly was delisted in a US$2.6 billion (RM7.96 billion) deal in 2010, sources with knowledge of the matter told Reuters today.

One of the sources, an official with Usaha Tegas, a special purpose vehicle controlled by Ananda, said no decision has been made on the re-listing of the company that was taken private in 2010 after a costly overseas expansion.

News of a possible IPO by Ananda, Malaysia’s second-richest man, comes on the heels of a US$2.8 billion sale of his power assets and proposal to hive off a stake in his satellite operator MEASAT Global.

The IPO could face hurdles partly because of an investigation in India involving Astro and Ananda’s telco firm, Maxis, and alleged bribes paid to a government minister and his brother, allegations the companies have denied.

“Banks have approached Usaha Tegas. Astro is the one of those companies that every bank wants to have a mandate on. It is been explored, but its too early to say anything concrete,” said the official at Usaha Tegas. He declined to be named because discussions over the deal are still private.

Astro officials declined to comment.

The potential listing adds fuel to speculation that Ananda, who Forbes estimates to have a net worth of $9.9 billion, may be slowing down after years of controlling a business empire that spans telecoms to property and oil exploration.

IPO timing, complications?

Bloomberg earlier cited sources as saying that the IPO could raise about US$1.5 billion by as soon as the end of this year.

But another source close to the deal told Reuters the IPO was more likely to happen next year if Ananda agreed to the deal because of possible Malaysian elections and other key share listings.

Any Astro listing could drain investor interest from a crop of IPOs due this year, which include plantation giant Felda Global Ventures Holding, Integrated Healthcare Holdings and Gas Malaysia.

No banks have been mandated for the Astro deal, both sources told Reuters, although CIMB Investment Bank is seen to be in the running.

If an Astro IPO goes ahead, it will join a stable of listed Ananda-linked firms such as oil and gas services provider Bumi Armada and telco Maxis that have a combined market capitalisation of more than RM17 billion.

Astro faces increasing competition from other Internet protocol television providers (IPTV) in Malaysia even though Astro has launched its own version of on-demand video via broadband, analysts say.

“Pay-TV companies are always at the mercy of content providers. So costs are rising faster than revenue,” said an analyst with an investment bank in Kuala Lumpur. “On top of that there is more competition now with other providers and IPTV is increasingly becoming the norm around the world. Satellite TV is dying,” he added. — Reuters