Saudi Telecom Company (STC) said it has reached a deal with Malaysian telecom operator Maxis Communications to increase its stake in their Indonesian JV Natrindo Telepon Seluler (NTS) from 51 to 80.1 per cent.

NTS operates in Indonesia under the Axis brand name, giving STC full management control.

As a result of the restructuring, STC’s equity ownership in NTS will rise to 80.1 per cent shrinking Maxis Communications' share to 14.9 per cent from 44 per cent. Harmersha Investindo (PTHI) will continue to hold 5 per cent, it added.

Commenting on the revamp, Dr Muhammad Bin Suliman Al-Jasser, chairman of STC, said Indonesia was an important strategic market for STC and one which offered a compelling growth opportunity.

'Already mobile market revenues in Indonesia have expanded broadly in line with nominal GDP growth of 16 per cent (CAGR) since 2006, but we believe that there is still significant potential to capture given the country’s young demographic which comprises almost a third of the current population,'  Dr Al-Jasser noted.

Saud Al Daweesh, STC Group CEO said increasing the ownership in this way will allow the company to control and direct the destiny of the Axis brand within this dynamic telecommunications market, both strategically and operationally.

'Our deep experience and technological expertise will undoubtedly be valuable in such a rapidly developing market,' he noted.

Axis doubled its revenues in 2010 from the 2009 level and now boasts 10 million active subscribers. In the next two years, STC has agreed to commit approximately $371 million to Axis as required by the business.

Additionally, STC will facilitate the provision of external funding in the coming five years to meet Axis funding requirements, it added.-TradeArabia News Service