It quoted a statement from the Kuala Lumpur-based Telekom, Southeast Asia's second-biggest telecommunications company, as saying the spin off separates the slower-growing fixed-line business, and allows the value of mobile business to be fully realized.
Telekom Malaysia has been selling down its stake in the Sri Lankan operation this year to realize a part of its value.
The firm sold a tranche of D last week to the International Finance Corporation.
Earlier in the year Telekom sold Dialog stock to finance a cash call by the subsidiary.
Telekom, Malaysia's largest phone company, in July said it will be a challenge to meet a 10 percent sales growth target this year as expansion tapers off in Malaysia.
Telekom wants to "let investors look at it on