Indosat spins off IDR Rp14.6tr fibre in FibreCo deal

Indosat Ooredoo Hutchison has agreed a joint venture with a consortium of Arsari Group and Northstar Group to house its fibre assets in a new company, FibreCo, in a deal that values the infrastructure at about IDR 14.6 trillion.

Indosat plans to spin off its fibre network into FibreCo under the investment agreement. The operator will monetise the assets while keeping an ownership stake of around 45% in the new entity.

The partners intend FibreCo to operate as an independent digital infrastructure platform. The company will focus on wholesale fibre services for mobile operators, internet service providers and enterprise customers across Indonesia.

Asset-light shift

Indosat has set out a strategy that places more emphasis on using shared infrastructure. The joint venture supports an asset-light approach and separates heavy network investment from the group's retail and service operations.

Vikram Sinha, President Director and CEO of Indosat Ooredoo Hutchison, said the collaboration aligns with a shared vision among the partners.

"Empowering Indonesia requires strong collaboration and a long-term view of digital infrastructure. Through a more agile and asset-light approach, the partnership with Arsari Group and Northstar Group allows us to build a stronger and more independent fiber platform that unlocks value, enhances resilience, and prepares networks for future digital services. It supports Indosat's transformation into a leading AI-driven company, while contributing to the broader industry progress in delivering high-quality digital experiences nationwide. FibreCo will act as a truly differentiated AI Infra player and a key catalyst for advancing Indonesia's national digital ambitions."

The company expects proceeds from the transaction to fund investment in its 5G network. It also plans to channel resources into data infrastructure that underpins its artificial intelligence strategy.

Indosat said the deal will allow it to concentrate on its core role as a telecommunications operator. The group wants to increase customer experience and grow its suite of digital and connectivity products while relying on FibreCo for underlying fibre access.

National backbone

The partners said the structure is intended to deliver benefits for the Indonesian market as well as for shareholders. They link the project with national plans for a stronger digital backbone and wider broadband coverage.

The Indonesian government has highlighted gaps between urban and rural connectivity. Private investment has become an important element in addressing those gaps and extending high-capacity networks beyond major cities.

The new entity will manage more than 86,000 kilometres of fibre across the country. The assets include backbone routes, domestic subsea cables and access links that connect mobile towers and business locations.

About 45% of the network lies on the island of Java. The remaining 55% serves non-Java regions across the archipelago, which the partners describe as central for more balanced digital development.

FibreCo will run on an open-access model. It will offer wholesale access to all telecommunications service providers rather than only to Indosat. The partners expect this structure to encourage shared use of infrastructure and reduce duplication of fibre roll-outs.

AI and inclusion

The parties link the venture with Indonesia's "Golden Indonesia 2045" vision. They state that dense, open fibre networks form a base for an economy that makes greater use of digital services and AI-led applications.

The partners expect improved fibre access to support cloud services, digital public services and remote working patterns. They also see a role for FibreCo in extending connectivity to smaller cities and rural communities.

Arsari Group will use the platform as its main entry into digital infrastructure investment. The group has existing positions in agroforestry, agriculture, energy and mining.

Aryo P.S Djojohadikusumo, Deputy CEO and COO of Arsari Group, said the venture fits into a broader national agenda.

"Under this partnership, Arsari Group intends to serve as part of the physical backbone of Indonesia's next growth phase-supporting enterprise productivity, digital inclusion, public service delivery, and the emergence of AI-driven economic activity. The partnership represents expansion of Arsari's portfolio into digital infrastructure, reflecting a long-term view that connectivity is becoming as fundamental to economic resilience as energy and physical logistics."

The companies said the alliance strengthens cooperation between the state and private sectors over digital infrastructure. They said this supplements government initiatives that address uneven network coverage and aims at more inclusive digital development.

Broader collaboration

The joint venture will focus on operational efficiency and long-term growth. The parties expect shared ownership and governance to support investment planning and maintenance of service standards across the network.

The partners describe the transaction as the start of a broader relationship. They plan further collaboration in areas that extend fibre reach, improve network quality, and reinforce Indonesia's digital foundations over the coming years.