Keppel to divest M1’s telco business to Simba in S$1.43b deal

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Keppel Ltd (Keppel) is divesting M1’s telco business to Simba Telecom for an enterprise value of S$1.43 billion in an all-cash deal.

The transaction, made through Keppel’s subsidiaries, will see Keppel receive close to S$1 billion in cash proceeds for its 83.9% effective stake, subject to post-completion adjustments.

Keppel will retain M1’s fast-growing ICT business, which complements its integrated connectivity portfolio including data centres and subsea cables. The deal values M1 at 7.3 times EV/EBITDA, which Keppel described as an “attractive” valuation.

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The proposed transaction is expected to reshape Singapore’s telecommunications sector by consolidating two agile, digitally-driven players with track records in innovation. Combining M1’s cloud-native network and hyper-personalised service capabilities with Simba’s digital consumer model could unlock synergies in network and infrastructure, creating what Keppel calls a “nimble and competitive digital-first telco” to support Singapore’s digital economy.

The divestment aligns with Keppel’s asset-light strategy as a global asset manager and operator, sharpening its focus within the Connectivity segment on digital infrastructure.

While Keppel estimates an accounting loss of S$222 million from the deal, it said the move crystallises long-term value from its investment in M1, which dates back to 1994. Including dividends and past proceeds, Keppel is expected to have received over S$700 million from M1 over the years.

According to a statement seen by MARKETING-INTERACTIVE, Simba emerged with the strongest bid among interested parties, offering the least overlap in resources and a fully cash-backed offer. The tie-up with M1 is also expected to create new revenue streams and career opportunities.

Regulatory approval from Singapore’s Infocomm Media Development Authority is required before the deal can be completed, which Keppel hopes to finalise in the coming months. Shareholder approval from either party is not required.

“The Proposed Transaction offers a strategic path to sustainable growth for Singapore’s telco sector. M1 and Simba are a highly synergistic combination — together, they can scale more efficiently, optimise infrastructure, and accelerate 5G and digital investments,” said Loh Chin Hua, CEO of Keppel.

“For Keppel, this is the latest step in our transformation as we simplify our business and advance our focus as a global asset manager and operator. The close to S$1 billion to be unlocked can be channelled to growth opportunities, lower our debt or reward our shareholders, improving ROE and supporting the market’s further re-rating of Keppel,” Loh added.

If completed, the deal would mark one of the most significant shifts in Singapore’s telco landscape in recent years, coming after the entry of new players such as TPG (now Simba) in 2016 and the incumbents’ (Singtel and StarHub) steady push into 5G.

Over the past decade, competition has intensified not only in price but also in service innovation, as telcos have moved aggressively into 5G rollouts, bundled digital entertainment packages, enterprise connectivity solutions, and mobile financial services.

The consolidation could also reshape marketing strategies in the sector. Currently, StarHub and Singtel have been pushing lifestyle-led and ecosystem-driven campaigns. For example, in 2022, StarHub launched a virtual universe on Roblox named "StarHub World". "StarHub World" provided a platform for customers to explore the telco's 5G plans, cloud gaming service as well as Premier+ OTT service.

Meanwhile, SingTel's long-standing "Hello Possibilities" campaign has seen numerous brand films tapping onto various celebrations such as Deepavali, Mother's Day and even an intercultural-wedding. The "Hello Possibilities" campaign has even created now-recognisable characters such as Uncle Raju who was first introduced in the film "AI Do" as an extra character, to later front his own film in "Lights out".

That said, a combined M1–Simba brand might lean heavily into its “digital-first” positioning, focusing on personalisation, customer experience, and innovative pricing models to differentiate itself.

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