Tower Bersama 10% Non-Preemptive Rights Issue

Tower Bersama Infrastructure (TBIG IJ, Neutral, TP: IDR8,600) is planning to conduct a non-preemptive rights issue for 479.65m shares (10%). This action is part of the share swap scheme with PT Dayamitra Telekomunikasi (Mitratel), subsidiary of Telekomunikasi Indonesia (TLKM IJ, BUY, TP: IDR3,200). Tower will also transfer its 53.29m treasury shares as part of the scheme. Therefore, the price of the non-preemptive rights is at IDR8,795/share. According to the initial agreement, TLKM has the option to swap 51% of Mitratel with 472.5 of Tower shares, which will result in TLKM holding 13.7% of TBIG while TBIG will have 100% of Mitratel. This action is subject to approval from shareholders in EGM on 22 December 2014.