SingTel, Singapore’s biggest company by market capitalization and Southeast Asia’s largest telecommunications company by revenue, has announced it will be buying American-based mobile advertising firm Amobee in a deal that may be worth US$321 million. This will be the cash-rich company’s first major overseas acquisition since 2007. The Singapore-based company will be adding the company to its long list of portfolio companies as it views mobile advertising as a huge growth area.
“SingTel will partner Amobee to build a strong independent company that will serve operators, publishers, advertisers and agencies with leading edge mobile advertising technology and services,” the company said in the statement.
In addition to mobile advertising, the company will be looking to tap into the huge mobile coupons and daily deals space, something that it hopes will bolster its income while diversifying its portfolio. The company currently holds major investment stakes in among others India’s Bharti Airtel, Indonesia’s Telkomsel, Thailand’s Advanced Info Service PCL., Pakistan’s Warid Telecom, Philippines’ Globe Telecom Inc. and Pacific Bangladesh Telecom.
The company has seen its revenues dip owing to dwindling returns from its investments as well as local factors such as lowering margins telecom core business and a rising currency. SingTel, which is Singapore’s largest company by market capitalization has been looking for greener pastures in the face of challenges that have been facing telecom companies the world over top of these being pressure from innovative entrepreneurs who are introducing products that are impacting telecom businesses negatively. A recent study showed that chat applications and IM tools scheme billions of dollars off telecom companies’ earnings every year and this trend may very well go from bad to worse over time.