Shares of Indonesia's third largest mobile operator XL Axiata dropped as much as 5.2 percent after its second-largest shareholder, Etisalat, sold about $510 million worth Of stock.
Etisalat, the United Arab Emirates' biggest telecommunications company, sold 775 million Axiata shares at 6,300 rupiah each, putting the deal at 4.88 trillion rupiah ($510.03 million), according to a term sheet of the offering seen by Reuters on Thursday.
In March, Etisalat was aiming to sell its entire 13.29 percent stake in XL Axiata to raise between $600 to $700 million this year, after failing to expand its partnership with XL Axiata's major shareholder, Malaysia's Axiata Group.
"It is common to sell on discount price, Etisalat had both capital and dividend gain from XL Axiata for five years. Maybe Etisalat want to cash it out and invest in another opportunity. But market seems to adopt it as negative sentiment," said Akhmad Nurcahyadi, a Jakarta-based BNI Sekuritas equity analyst.
At 11.12 am. (0450 GMT) the stock was trading down 2.99 percent at 6,500 rupiah with 21.0 million shares traded, the second highest turnover on the Indonesian stock exchange. The Jakarta Composite Index was down 0.01 percent.
1156 (0456 GMT) (Reporting by Andjarsari Paramaditha)