By Yantoultra Ngui
SINGAPORE - Malaysian telecom infrastructure and subsea cable services company OMS Group will revisit its plan for an initial public offering in the next few years and is not ruling out a listing on the domestic stock exchange, its top executive said.
OMS shelved its Malaysian IPO plan last year as KKR invested $400 million in the company as part of the global investment firm's expansion into digital infrastructure in Southeast Asia.
"An IPO is certainly something to consider in the future," OMS Group's deputy CEO Richard Sun told Multibagger on the sidelines of the Submarine World Networks World 2024 industry conference last week in Singapore.
"As for the listing venue, it is still early days. When the time comes, we will explore the most suitable options including Malaysia," he said, without giving details.
In June, OMS announced it secured $292.5 million worth of loans from a group of financial institutions including HSBC, E-Sun Commercial Bank and SinoPac, with KKR's facilitation.
OMS Group will use the capital to expand, including adding newly built vessels by 2029 to its current fleet size of five, Sun said.
It is also growing its interconnect managed services (IMS) or cable landing stations and subsea cable routes business launched five years ago, and expects the business to contribute significantly to its revenue in the next five years, he added.
The company currently has cable landing stations and subsea cable routes business operations in Malaysia, Singapore, Indonesia and Thailand, according to Sun.
"We're looking at Vietnam and the Philippines," Sun added. "Essentially, what we are becoming is a one-stop shop solution for connectivity requirements within the Southeast Asia region."
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## OMS Group Eyes Future IPO and Expansion with Strategic Investment from KKR
### Understanding OMS Group's Strategic Moves and Their Financial Implications
By Yantoultra Ngui
SINGAPORE – OMS Group, a leading Malaysian telecom infrastructure and subsea cable services company, is poised to revisit its initial public offering (IPO) plans in the coming years. The company is considering a potential listing on the domestic stock exchange, as confirmed by Deputy CEO Richard Sun during the Submarine World Networks World 2024 conference in Singapore.
### Background: KKR's Strategic Investment
Last year, OMS Group deferred its IPO plans following a substantial $400 million investment from global investment firm KKR. This investment is part of KKR’s broader strategy to expand its footprint in Southeast Asia's digital infrastructure sector.
### Future IPO Considerations
"An IPO is certainly something to consider in the future," stated Sun. The decision on where to list remains open, with Malaysia being a potential candidate. However, specifics on the timing and venue are yet to be disclosed.
### Financial Backing for Expansion
In June, OMS Group secured $292.5 million in loans from financial heavyweights including HSBC, E-Sun Commercial Bank, and SinoPac, facilitated by KKR. This capital injection is earmarked for significant expansion efforts, including the addition of new vessels by 2029, augmenting its current fleet of five.
### Growth in Interconnect Managed Services
The company is also intensifying its efforts in the interconnect managed services (IMS) sector, focusing on cable landing stations and subsea cable routes—a business they launched five years ago. Sun highlighted that this segment is expected to contribute substantially to the company's revenue over the next five years.
### Regional Expansion Plans
OMS Group currently operates cable landing stations and subsea cable routes in Malaysia, Singapore, Indonesia, and Thailand. Future expansion targets include Vietnam and the Philippines, aiming to become a comprehensive connectivity solution provider within Southeast Asia.
### Breakdown and Analysis
#### What This Means for Investors:
1. **Potential IPO**: If OMS Group proceeds with an IPO, it could offer a lucrative investment opportunity, especially given the backing by KKR and the company's strategic growth plans.
2. **Expansion**: The substantial loans and planned fleet expansion indicate OMS Group's commitment to scale its operations, which could drive future profitability.
3. **Revenue Growth**: The focus on IMS and cable landing stations is likely to boost revenue, making the company more attractive to investors.
#### How This Affects You:
- **Financial Opportunities**: For potential investors, keeping an eye on OMS Group’s IPO plans could present a significant financial opportunity.
- **Market Dynamics**: Understanding the expansion in digital infrastructure can help you make more informed decisions in the telecom and tech investment sectors.
- **Connectivity Improvements**: The expansion of subsea cable routes and landing stations could enhance connectivity in Southeast Asia, impacting businesses and consumers positively.
By grasping these elements, even those new to financial markets can appreciate the strategic importance of OMS Group’s plans and how they might influence market dynamics and personal investment opportunities.