Monday, January 30, 2012

SL telecom sector gets US $ 69 m investments

Sri Lanka’s telecommunication sector received a record US $ 69 million investment last year. The industry received this boost from five leading operators, Sri Lanka Telecom, Dialog Axiata, Etisalat, Bharathi Airtel and Mobitel. The biggest investment to the sector was made by Bharti Airtel Lanka, a subsidiary of Bharti Airtel, one of the world’s largest telecom service providers, which was the fifth player in the local mobile market. The company invested US $ 49.9 last year.

Malaysian based Dialog Axiata also invested heavily last year to the tune of US $31.8 million.

An official from the company said that the company’s main focus last year was laying of the fiber optic cable.

This was mainly to increase its broad penetration and to give faster broadband, he said.

Dialog Axiata is also being recognised as the first company under its aegis to reach the Foreign Direct Investment milestone of USD one billion. Dialog Axiata surpassed the USD one billion cumulative investment milestone as at December 31, 2010 and at the completion of the rapid network expansion programme would reach a total investment of approximately USD 1.2 billion since inception.

Dialog also entered a Share Purchase Agreement (SPA) to acquire 100 percent of ordinary shares of the wireless fixed line operator Suntel Ltd from its current shareholders.

The certain execution of the acquisition will follow the meeting of conditions precedent to the transaction defined in the SPA. Meanwhile Etisalat too made heavy investments last year pumping US $ 30.8 million.

This was mainly to widen their coverage and for other infrastructure development.

The Dubai based firm acquired the Sri Lankan Tigo unit form Luxembourg listed Millicom for USD 207 million and since then have had invested aggressively with the main focus on the expansion of their 3G network.

The Sri Lanka Telecom’s Mobitel, last year focus too was on the laying of the fiber optic line in a bid to match competition and had invested US $ 16.7 million last year.

Sri Lanka’s telecommunication giant Sri Lanka Telecom (SLT) plans to further invest Rs five billion in its mobile subsidiary, Mobitel.

In a disclosure at the Colombo Stock Exchange, the SLT announced that funds invested will be used by Mobitel for expansion in terms of coverage, capacity, and network modernization.

“This investment which will be on staggered basis is expected to be made within a period of six months,” the company said.

The Sri Lanka Telecom invested US $ 8.4 million last year.

In April 2011, BOI granted approval to phase II of Telecommunication, IP, Broadband, Infrastructure Expansion [TIBIX] project.

With this approval, SLT is entitled to import project related capital goods on duty free basis during the project implementation period of two years. SLT’s spend for the expansion project will exceed US$ 187 million.

Daily News By Shirajiv SIRIMANE