Simba-M1 deal setback dims hopes for telco tie-ups: report

StarHub's Antina 5G venture could still support a future merger. 

The stalled Simba-M1 merger has banished hopes for near-term market tie-ups in Singapore’s telecommunications sector, leaving operators exposed to continued pricing pressure, according to an RHB report.

While this is a near-term negative for the sector, RHB said consolidation remains a key theme over the longer term.

RHB said renewed discussions between Keppel and StarHub could not be ruled out, noting that StarHub has repeatedly said it is open to mergers and acquisitions.

It added that StarHub and M1’s Antina joint venture, which supports 5G network sharing, is a possible basis for a future merger case.

Meanwhile, the mobile market remained under pressure during the March reporting season, with renewed price cuts and weaker roaming revenue amid cheaper roaming bundles and competition from travel e-SIMs.

“StarHub’s results missed estimates again, whilst Singtel’s earnings were in line, with stronger growth at NCS, Optus and associates offsetting a weaker domestic performance,” RHB said.

Mobile operators are also continuing to vie with virtual telcos for revenue share, with competition expected to remain tight in the second half of the year.