Separating from Telkom, IndiHome Service Officially Joins Telkomsel Starting July 1, 2023

Previously, Telkom Indonesia or Telkom and Telkomsel had signed a Conditional Spin-off Agreement (CSA) to integrate IndiHome with Telkomsel.

Regarding the separation of the IndiHome business from Telkom, Telkomsel will issue a number of new shares for Telkom. IndiHome’s current value reaches IDR 58.3 trillion or the equivalent of USD 5.1 billion. This figure is 50 percent higher than Telkom’s equity, when combined with other commercial agreements between Telkom and Telkomsel.

Thus, this transaction is categorized as a material transaction that requires approval from Telkom’s independent shareholders.

Simultaneously with this Telkomsel and IndiHome merger, Singtel agreed to exercise its rights to take a new 0.5 percent stake in Telkomsel with a value of IDR 2.7 trillion or the equivalent of USD 236 million in cash.

This makes Singtel’s effective ownership in Telkomsel to 30.1 percent, while Telkom’s ownership in Telkomsel rises to 69.9 percent.

With this strategy involving IndiHome and Telkomsel, Business to Consumers (B2C) at TelkomGroup will be fully managed by Telkomsel. Meanwhile, Telkom’s operational focus is Business to Business (B2B).

The FMC initiative is expected to strengthen TelkomGroup’s position as an integrated telecommunications company to respond to growing customer needs and create synergies through an extensive customer network.

Main Director of Telkom, Ririek Adriansyah, said that the broadband service process for TelkomGroup retail customers is part of the ‘Five Bold Moves’ business transformation to strengthen the company’s position as a leader in the digital telecommunication market.

“Integration with Telkomsel is one of Telkom’s mainstay business lines. This will enable people to get broader broadband services, where customers can move freely without worrying about losing service,” said Ririek.

Meanwhile, Telkomsel Main Director Hendri Mulya Syam said, the integration of IndiHome services is expected to strengthen Telkomsel’s position in the telecommunication and digital industry in Indonesia.

With this integration, Telkomsel can expand its business in Fixed Mobile Convergence (FMC) services.

Singtel Group CEO Yuen Kuan Moon said, “This integration will provide customers with more choices, innovation and a better experience.”