MTNL bids for Lanka''s fixed wireless operator Suntel
28 Sep 2007
The state-run
Mahanagar Telephone Nigam Ltd (MTNL) has submitted a bid to acquire Sri Lankan
fixed-line wireless operator Suntel, for $100 to 120 million. If successful, this
would be its first overseas takeover. The price factors in a legal case worth
LKR4 billion (Sri Lankan rupees) involving a customer, sources said.
Other
contenders for Suntel include Malaysia Telekom, a consortium led by John Keells
Holdings and the Tata-controlled VSNL. If MTNL acquires the company, it will take
on a local partner, the sources added.
The result of the bids is expected
in the next fortnight. The privately-owned Suntel has three lakh subscribers,
and an NLD / ILD license. The acquisition would give the successful bidder leverage
on data services, fixed lines and a host of corporate and small-and-medium business
(SME) customers.
The company also operates in Nepal and the Maldives on
licences. Its medium-term debentures are listed on the Colombo Stock Exchange.
Suntel has recently filed a petition against Electrotek Network Services to recover
LKR69.3 million for telecom services rendered to the company, but that it faced
a counter suit of over LKR4 billion for terminating the telephone services.
Suntel
posted a net profit of LKR311 million for the half year ending June 2007. Revenue
rose to LKR3,600 million from LKR3,300 million in the first half of 2006.
