Telekom Malaysia selling five percent of Dialog

Telecom Malaysia, majority shareholder of Dialog Telekom is planning to sell five percent of its 87.5 percent stake in Dialog to liquidate the company’s share concentration in order to attract more foreign investors.

“Only 12.5 percent of Dialog is listed in the Colombo Stock Exchange (CSE) and 80 percent of this is held by overseas investors,” a stock market analyst told The Sunday Times FT, adding that foreign investors are concerned that there is not much liquidity in the Dialog shares.

He explained that presently the Central Depository Systems (CDS) holds 17.5 percent of Dialog Telekom. “This new 5 percent was listed very recently (when a company wants to sell part of its stake, it has to list that in the CDS).

There are some Middle East investors who are in talks with Dialog to buy this 5 percent stake,” he added, saying the possible sale price per share would be Rs. 30.

Another broker said that soon after Dialog announced its rights issue last Friday, its share price dipped to Rs. 24 from Rs.26.50.
“The share started picking up on Monday mainly because the market was aware of this deal,” he said.

Dialog is the highest profit contributor to the parent company among all its overseas businesses in the region.