U Mobile announced that Straits Mobile Investment has agreed to reduce its stake in the Malaysian telecom operator from 48.3% to 20%.
This move is part of a "strategic alignment" aimed at fostering local partnerships to help establish Malaysia's second 5G network. Straits Mobile Investment is a subsidiary of ST Telemedia, a privately held company owned by Temasek Holdings, the Singapore government's investment arm. Temasek also owns the telecom company, StarHub, and data center operator, STT GDC.
"While foreign ownership is common in the telco sector, U Mobile's strategy prioritizes the development of the Malaysian industry and the strengthening of local ownership. This increased local partnership supports U Mobile's dedication to national interests," U Mobile said in a statement.
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Shifting from a Monopolistic Model
U Mobile is confident in its ability to deliver a rapid and cost-effective 5G rollout for Malaysia. As the most recent market challenger, U Mobile's subscriber base grew to nine million by the end of 2023. Having invested more than MYR 5 billion in its network infrastructure, the operator now boasts over 10,000 network sites and covers 95% of the national population, aligning with industry peers. U Mobile also employs more than 1,000 Malaysians.
The Single Wholesale Network (SWN) model, introduced in 2021 by Digital Nasional Berhad (DNB), a wholly owned unit of the Ministry of Finance, designates DNB as the sole operator to manage and provide wholesale 5G network services to all mobile network operators (MNOs).
The establishment of a second 5G network signals Malaysia's shift from a monopolistic model toward a more competitive telecommunications environment.
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The Malaysian Communications and Multimedia Commission (MCMC) previously stated that U Mobile's selection was based on several factors, including its submitted business and technical plan, customer satisfaction records, complaint rates, and its performance in delivering infrastructure initiatives. This includes Universal Service Provision (USP) projects like JENDELA Phase 1 and other 4G upgrade projects.
U Mobile expressed its gratitude to the Malaysian government and MCMC for placing their trust in the company to lead the rollout of Malaysia’s second 5G network. The operator believes it is well-positioned to serve as the country's second 5G network provider.
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