Jakarta. State-run construction firm PTPP announced Wednesday that its subsidiary PT PP Infrastruktur would divest its shares in Ultra Mandiri Telekomunikasi (UMT)  to telco infrastructure company Mitratel. 

The companies had already signed a share purchase agreement in Jakarta on Monday. 

UMT is PT PP Infrastruktur’s telco infrastructure subsidiary. According to PTPP’s press release, the divestment process took place via the so-called beauty contest. This share purchase is also worth Rp 650 billion or around $40.8 million. 

“The signing of the share purchase agreement marked a crucial strategic step not just for both sides, but also to the growth of the telecommunications infrastructure industry. The process starts with the appointment of Indonesia Infrastructure Finance [IIF] as the financial advisor, and is open to the public,” PTPP’s corporate strategy director I Gede Upeksa Negara was quoted as saying in a press statement.

 Out of the companies that have expressed interests, one state-owned enterprise, two domestic private companies and one foreign company took part in the beauty contest.

“We consider this transaction as the company’s commitment to support the telecommunications infrastructure industry. This also aligns with our efforts to bolster the company’s portfolio to support our core business in a more integrated manner,” Gede said.

According to Mitratel’s president director Theodorus Ardi Hartoko, this acquisition has strategic value in strengthening the business ecosystem and maintaining market share control.

"Our consistency in consolidating the tower business, fiber optics and other supporting services will bring Mitratel to be the largest digital infraco in the Asia Pacific," Theodorus said.