Middletons, in co-operation with Iffla Wade, acted for Tower Bersama Infrastructure Tbk PT (TBIG) in successfully signing an agreement with Indosat for the purchase of 2,500 tower assets and lease of site space to PT Indosat Tbk (Indosat), for upfront amount of US$406 million made up of cash and shares and a maximum potential earn-out amount of US$113 million.
TBIG provides telecommunication infrastructure services to Indonesian wireless carriers, develops and operates telecommunication supporting infrastructure including tower and in-building systems across Indonesia and leases space under long-term agreements with telecommunications operators. The company also provides operators with access to its distributed antenna system networks in shopping malls and office buildings.
Indosat is a leading telecommunications and information service provider in Indonesia and the country’s second largest mobile phone provider.
Middletons lead special counsel on the deal, Chris Scott said, “Indonesia is becoming an increasingly active area for our team and this acquisition required negotiation of complex commercial arrangements.”
In explaining the details of the transaction, Chris said, “The upfront amount is comprised of both cash as well as newly issued TBIG shares. The share consideration is based on trailing market prices over a period prior to closing, and will represent approximately 5% of TBIG’s enlarged share capital. Under the terms of the agreement, Indosat will lease all 2,500 towers, as an anchor tenant, from TBIG for a minimum period of 10 years. The transaction consideration will be financed by the company through bank debt, the subscription amount from the new shares and from internally generated funding.”
The completion of the transaction is subject to various approvals including those of TBIG’s shareholders and Indosat’s bondholders and lenders. The transaction is expected to be completed during the second quarter of 2012.
Chris said, “The work for this acquisition included structuring, drafting and negotiating a complex set of agreements based on cash and share contributions with due regard to the on-going long term commercial relationship of the parties. Middletons will also be involved in negotiating documentation for the debt finance for the cash portion of the purchase price.”
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