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MTNL’s Suntel acquisition stuck in search of right partner (India)

  • August 14th, 2008
  • 7:30 am

MTNL has made it’s first-ever overseas acquisiton, which stuck in search of the joint venture partner to pick up 50% of the stake in Sri Lankan operator Suntel, reports ET.

“We are looking for a partner to pick up 50 per cent in Suntel, all other issues have been settled,” a senior MTNL official said.

According to the official MTNL’s acquisiton of Suntel is for the purpose of expansion of the business overseas market due to shrinking domestic opportunities and it prefers to outright acquisitions rather than bidding for licences.

MTNL does not want a majority control in Suntel and wants it to be an independent firm, not MTNL subsidiary.

According the sources the bid is of around  100-120 million dollars.

   

MTNL sees bright future in Suntel, despite legal issue (Sri Lanka)

  • October 1st, 2007
  • 9:39 am

Indian state-run telco Mahanagar Telephone Nigam Limited (MTNL) has submitted a formal bid to acquire Sri Lankan fixed-wireless operator Suntel, in the range of USD100 million to USD120 million, factoring out liability costs related to an ongoing legal case involving a Suntel customer, according to Indian media reports. MTNL plans to form a partnership with a local company to launch services if its bid is successful, according to local sources. Companies lining up rival bids for Suntel are Indian international telecoms carrier VSNL, Telekom Malaysia and a consortium led by Sri Lanka’s John Keells Holdings. The result of the tender is expected in the next fortnight. Suntel posted a net profit of LKR311 million (USD2.74 million) for the first half ending June 2007, whilst revenues rose to LKR3.6 billion, up from LKR3.3 billion in the first half of 2006. Suntel offers fixed line services based on CDMA WiLL technology, and claimed around 300,000 WiLL lines in service at the end of March 2007. Nordic telco TeliaSonera is Suntel’s top shareholder with a 55% stake via holding vehicle Overseas Telecom. The remaining shares are held by Sri Lanka’s Metrocorp, the National Development Bank of Sri Lanka, Townsend Ltd of Hong Kong and International Finance Corporation.

   

 

 

MTNL close to buying Suntel

  • July 16th, 2007
  • 3:22 pm

Indian telco Mahanagar Telephone Nigam Ltd (MTNL) is close to completing a purchase of Sri Lankan fixed-wireless operator Suntel, according to regional press reports. The NYSE-listed state-run operator has sent a high-level delegation to conduct due diligence on the company, which is a prerequisite to formalise the deal, company sources said. MTNL is believed to have emerged as the highest bidder for Suntel with a bid of between USD160 million and USD180 million. Colombo-based Suntel offers fixed line services based on CDMA WiLL technology, and claimed around 300,000 WiLL lines in service at the end of March 2007. All its key shareholders want to exit, sources said. Nordic telco TeliaSonera is Suntel’s top shareholder with a 55% stake via holding vehicle Overseas Telecom. The remaining shares are held by Sri Lanka’s Metrocorp, the National Development Bank of Sri Lanka, Townsend Ltd of Hong Kong and International Finance Corporation. MTNL’s only existing overseas telecoms venture is in Mauritius, where it offers fixed line and mobile services as Mahanagar Telephone (Mauritius). Three other bidders were previously reported to be in the final stage of the bidding process for Suntel: Malaysia Telekom, Sri Lankan blue chip conglomerate John Keells Holdings and another Indian telco, VSNL.

   

VSNL aiming to buy Suntel

  • January 15th, 2007
  • 1:07 pm

Telegeography writes…India’s leading international telecoms provider Videsh Sanchar Nigam Ltd (VSNL) is in talks to buy Sri Lankan fixed line operator Suntel for an undisclosed sum, according to local newspaper the Economic Times. VSNL recently won international long-distance (ILD) and ISP licences in Sri Lanka, and is hoping to expand its existing inbound carrier business through acquisitions to become a full-service telecoms provider on the island.

Suntel had an estimated 250,000 wireless in the local loop (WiLL) subscribers at the end of 2006. Its portfolio includes basic telephony, pre-paid voice services, corporate data solutions, ISDN, dial-up internet access and xDSL lines. Suntel’s biggest shareholder is Nordic telco TeliaSonera, which holds a 55% stake via holding company Overseas Telecom AB. The remaining shares are split between Sri Lanka’s Metrocorp, the National Development Bank of Sri Lanka, Townsend Ltd of Hong Kong and the International Finance Corporation (IFC, a member of the World Bank Group). Suntel’s net profit for the six months to 30 June 2006 dipped by LKR93 million (USD850,000) year-on-year to LKR290 million (USD2.67 million), while revenues virtually doubled to LKR3.31 billion (USD30.5 million) from LKR1.96 billion a year earlier.

VSNL earns around three-quarters of its revenue abroad. The Tata Group subsidiary is a co-owner of Neotel, South Africa’s second national operator, and has acquired Teleglobe International Holdings Ltd and Tyco International’s global submarine fibre-optic cable network. On its Sri Lankan strategy, a VSNL executive said: ‘VSNL entered Sri Lanka in 2003 and views it as an important, growing market. The company’s ILD voice and data services have been well received and it plans to leverage its success in this market.’