Telkom Prioritizes Telkomsel Buyback, Aims To Make it 100% Indonesian

Telkom is still aiming to get its 35 percent share back from Singapore Telecom (SingTel). The company has made it a priority over its other plans, including acquiring Indosat StarOne.

This buyback issue goes all the way back to 2008. But the pressure is recently getting stronger since government mandated it in a general meeting of Telkom shareholders in May. It encouraged the company, as Telkomsel’s holding company, to complete its share ownership and make it a 100 percent Indonesian cellular company.

The company’s CEO, Rinaldi Firmansyah, was quoted by Bisnis Indonesia as saying that the Telkom will prioritize buyback within the year. He also said that management had informally communicated the buyback plan with SingTel.

This subsequently resulted in the stalling of Telkom’s plan to acquire Indosat StarOne. Even though it aspired to consolidate StarOne with Telkom Flexi, it seems they don’t want to lose the opportunity to boost Telkomsel’s business through a buyback.

Telkom is still waiting for Indosat to follow up on its proposal.