This article first appeared in The Edge Malaysia Weekly on April 28, 2025 - May 4, 2025

U Mobile Sdn Bhd, which is planning to roll out the country’s second 5G network, could be listed as early as next year as it is already in the midst of preparing for an initial public offering (IPO) with a targeted valuation of more than RM10 billion.

Sources say the mobile network operator (MNO) is targeting a valuation of between RM11 billion and RM12 billion and has appointed CIMB Investment Bank Bhd as its adviser.

U Mobile’s flotation exercise has long been in the works — an IPO contemplated as far back as 2014 — and its public share sale application is expected to be submitted to the regulator in the second half of the year.

“The draft prospectus is estimated to be launched in the second half of the year, and the listing is expected to be in late 2025 or early 2026,” a source tells The Edge.

Another source says U Mobile is targeting to raise between RM3 billion and RM4 billion from the public share sale and that there will not be any offer for sale shares. “The IPO plan has been ongoing for several years and the company wants it to happen as early as 2026,” he says.

When contacted, U Mobile said: “U Mobile is committed to transparency and will communicate any firm decisions regarding an IPO through official channels in due course.”

Earlier in the year, its chairman Tan Sri Vincent Tan said the company was targeting to list on Bursa Malaysia by end-2025 and that the group was planning to roll out the second 5G network within the next 15 to 18 months. He maintained that the company would not require any government funding or local partners to facilitate the rollout.

“We are looking at Chinese suppliers, either Huawei or ZTE. They are the best in terms of 5G technology. They will supply the 5G equipment and provide financing. We need to fork out our own capex (capital expenditure) together with financing from the banks. But everything is still not finalised yet,” Tan was quoted as saying.

U Mobile’s IPO could be the largest in eight years, bigger than 99 Speed Mart Retail Holdings Bhd’s (KL:99SMART) in September last year, which raised RM2.36 billion. At RM1.65 per share, 99 Speed Mart’s IPO translated into a market capitalisation of RM13.86 billion, although the minimart operator is worth a lot more now since its share price had risen to RM2.22 last Thursday.

U Mobile initially targeted to list in 2018, but could not find the opportunity to do so, only to be further delayed by the Covid-19 pandemic.

Last November, the company said its earnings before interest, taxes, depreciation and amortisation (Ebitda) had turned positive since 2017. However, according to its CTOS documents, it posted a loss of RM722 million in its financial year ended Dec 31, 2024 (FY2024), compared with a profit after tax of RM102 million in FY2023. The group’s total assets stood at RM5.98 billion, with total liabilities at RM8.02 billion.

On Jan 15, Hong Leong Investment Bank said in a client note that U Mobile would likely struggle to roll out the second 5G network, which would push the company to consider a merger. The research house noted that the deployment would be “an uphill task for U Mobile considering its size and financials”.

However, one of the sources pointed out that as the company is planning to raise funds via an IPO, a merger would not be needed.

Launched in 2007, U Mobile has increased its subscriber base from less than 50,000 to more than four million in less than five years. By end-2023, it had more than nine million subscribers to close the gap between itself and the top three players — Maxis Bhd (KL:MAXIS), CelcomDiGi Bhd (KL:CDB) and Celcom Axiata Bhd.

Maxis had about 9.7 million mobile subscribers as at end-2024, while CelcomDiGi had 20.4 million subscribers, as Celcom and Digi completed their merger in December 2022. 

According to the latest CTOS data, U Mobile’s largest shareholder is Singapore-based Straits Mobile Investment Pte Ltd with 1.025 billion shares, or a 48.25% stake. The second-largest shareholder is His Majesty Sultan Ibrahim, King of Malaysia, with a 22.31% stake.

Tan holds a cumulative 13.66% of U Mobile through his companies Singer (Malaysia) Sdn Bhd (6.09%), U Telemedia Sdn Bhd (5.59%) and Berjaya Infrastructure Sdn Bhd (1.98%). However, it is unclear if Straits Mobile remains the largest shareholder as it had planned to reduce its stake in U Mobile.

Last December, Singapore Technologies Telemedia Pte Ltd (ST Telemedia) announced that its unit Straits Mobile had entered into an agreement to sell “a majority stake” in U Mobile and that on completion of the transaction, Straits Mobile would hold a minority stake of about 20%, and that U Mobile would cease to be its subsidiary.

Mawar Setia Sdn Bhd — incorporated in April 2024 and owned by Tan and Johor princess Tunku Tun Aminah Sultan Ibrahim — was to buy the majority stake. Companies Commission of Malaysia data shows that the company is 70% owned by Tan and 30% by Tunku Tun Aminah. 

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