Gobind: DNB and newly appointed directors to meet next week to look into due diligence findings
Digital Minister Gobind Singh shared today that the newly reconstituted board of Digital Nasional Berhad (DNB) will meet next week to look into due diligence findings. This comes after DNB appointed 5 directors representing CelcomDigi, Maxis, U Mobile, Telekom Malaysia and YTL, as part of the ongoing process to finalise the Share Subscription Agreement (SSA) which was signed by the 5 telcos with DNB in December 2023.
Gobind told reporters that DNB will convene a meeting next week to look at the due diligence report. It is understood that the ongoing due diligence review process will be followed by a formal board meeting. The participating telcos will have 20 days to recommend and decide on the next steps.
CelcomDigi, Maxis, U Mobile, TM and YTL signed the Share Subscription Agreement to take a collective 70% stake in DNB
If all requirements of the SSA are fulfilled by then, the equity deal which allows the 5 major telcos to acquire a collective 70% stake (14% per telco) in DNB can be finalised. The Malaysian government via the Ministry of Finance (MOF Inc) will then reduce its stake in DNB from 100% to 30%, while holding a golden share.
This would be the Malaysian government’s second attempt to get telcos to participate in the 5G Single Wholesale Network as the previous SSA signed by Celcom, Digi, TM and YTL back in October 2022 had failed to materialise after the long stop date to fulfil all conditions precedent under the SSA had lapsed.
Malaysia’s 5G Dual Network Model
Gobind assured last week that Malaysia remains committed to implementing the Dual 5G Network model. The 5G policy shift to transition from a Single Wholesale Network to a Dual Network model was announced by Communications Minister Fahmi Fadzil in May 2023.
The Digital Minister said it is the Government’s aspiration as per the policy announcement, that the SSAs which are an integral process of the first phase, will enable the participation of all the telcos in DNB as shareholders, before the eventual shift to the Dual 5G network. Once the requirements of Phase 1 which include the full participation of telcos and 80% 5G population coverage by DNB is fulfilled, Malaysia will enter Phase 2 which is the shift to Dual Network and the divestment of the government’s equity in DNB.
When Phase 2 is initiated, some telcos will remain in DNB, while the remaining telcos will move to the second 5G network and divest their equity in DNB.
Fahmi revealed previously that the government will unveil the second 5G network this week. However, no announcements have been made about it by the Communications Ministry as well as the Malaysian Communications and Multimedia Commission (MCMC) this week.
Fahmi previously declared that DNB has achieved 80.2% population coverage by 31st December 2023 and the coverage has increased slightly to 80.3% as of February 2024.
Gobind shared this morning that Malaysia’s 5G network deployed by DNB has reached 80.5% population coverage as of March 2024 while the adoption is currently over 35% with more than 11.9 million 5G mobile subscriptions in the same period.