NetLink briefs analysts on $1.4bn IPO as fees cut

Bloomberg

NetLink Trust, the fiber broadband network provider backed by Singapore’s biggest phone company, started briefing analysts this week ahead of an initial public offering that could raise at least S$2 billion ($1.4 billion), people with knowledge of the matter said.
The arm of Singapore Telecommunications Ltd. began meeting research analysts to explain its business model, which will later be followed by meetings with potential investors, according to the people. NetLink Trust, which announced the government has cut most of its prices, has been discussing a potential annual dividend yield of about 4 percent to 5 percent, the people said, asking not to be identified because the information is private.
Terms of the offering haven’t been set yet, and details such as the potential yield and deal size could change, the people said. NetLink Trust is targeting to complete the IPO by July, the people said.
The firm said it accepted price revisions for its services, in the first change to monthly recurring fees since Singapore introduced its fiber network infrastructure in 2009. Prices have been cut for residential connections, where it gets more than half its revenue, as well as non-building connections like lamp posts and bus stops. Charges for companies have been increased under the new structure, which will be in effect from 2018 through 2022.
A representative for NetLink Trust declined to comment, while representatives for Singtel didn’t immediately respond to emailed queries.
NetLink Trust, led by Chief Executive Officer Tong Yew Heng, gets a one-time installation charge and recurring monthly fee for each end-user connection. It also books revenue from providing services for its other infrastructure including ducts and manholes. The firm posted revenue of S$258 million for the financial year ended March 2016 and earnings before interest, taxes, depreciation and amortization of S$183 million, its website shows.