Indonesia-based Telkomsel struck an agreement to sell 6,050 towers to tower company PT Dayamitra Telekomunikasi (Mitratel) for $950 million, as the operator looks to focus on its core connectivity business.

In a stock exchange filing, it was revealed Telkomsel would enter into a ten-year lease agreement with Mitratel to rent the tower space once the deal completes, which is expected to be carried out in stages and signed-off in the first quarter of 2021.

Both companies are subsidiaries of Telkom Indonesia, which owns 100 per cent of Mitratel and 65 per cent of Telkomsel. Singtel owns the other 35 per cent.

In a statement, the Singaporean operator said the transaction would allow Telkomsel to “optimise its capital structure”, as part of a focus on its core business of providing digital connectivity services to customers in Indonesia.

Mitratel CEO Theodorus Ardi Hartoko added the telecoms tower business in general still had a lot of promise, as operators continue to expand network quality and service range, with 5G providing a boost to the segment.

The company will have a tower capacity of more than 22,000 should the deal complete.