Mobitel finalises terms of Hutch takeover, report says

11 Feb 2014

Mobitel, the cellular division of state-controlled Sri Lanka Telecommunications (SLT), has reportedly finalised the terms of a deal to purchase rival cellco Hutchison Telecommunications Lanka (Hutch) which will be completed ‘very soon’, for an undisclosed price expected by analysts to top USD100 million, according to Sri Lankan newspaper The Island. The report said that the final agreement on terms and conditions followed necessary due diligence carried out by SLT and the seller, Hong Kong-based Hutchison Asia Telecom (HAT), part of Hutchison Whampoa. Regulatory clearance is now required for the takeover to be completed. SLT sources cited by The Island said that acquiring Hutch will add approximately a million additional subscribers to Mobitel’s roughly five million-strong subscriber base, plus raise Mobitel’s number of base stations from around 5,500 to 8,000, while the sources also claimed that ‘by acquiring Hutch, Mobitel will be the largest 3G operator in the country with the best bandwidth.’ The same sources were cited as saying that the acquisition of Hutch would be partly funded with internally generated cash and partly by debt.



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