Southeast Asia's largest telecommunications operator, Singtel, has divested a 2.8% stake in Thailand's leading energy company, Gulf Energy Development, to raise funds for new investment projects. The transaction is valued at approximately S$1 billion, equivalent to US$772.9 million.

In a statement released on Tuesday, Singtel indicated the shares were sold directly to a group of institutional investors. The sale is expected to generate a net investment gain of around S$140 million for the company.

Following this transaction, Singtel will retain a 4.95% shareholding in Gulf Energy Development, with an estimated value of about S$1.8 billion.

Singtel Group Chief Financial Officer Arthur Lang stated, "This divestment is part of our ongoing portfolio review and disciplined capital management approach."

Lang added that the company's partnership with Gulf Energy Development remains strong and that Thailand continues to be an important market for Singtel.

This asset sale coincides with Singtel's strategy to increase investments in high-growth sectors. The company anticipates its capital expenditure for the current fiscal year will reach approximately S$3 billion, up from S$2.5 billion in the previous year.

In an interview in May, Singtel CEO Yuen Kuan Moon highlighted that S$1.2 billion of this capital expenditure is specifically earmarked for data center and artificial intelligence initiatives. This includes launching GPU-as-a-service in Southeast Asia, with a particular focus on providing sovereign AI capabilities in Singapore.

Shares of Singtel last traded at S$4.30, down 1.38%.