Sri Lanka briefs market on telcos’ 4G investment plans

25 May 2018

Sri Lanka’s Minister of International Trade and Investment Malik Samarawickreme has informed parliament that the government’s Board of Investment of Sri Lanka has formally approved USD1.3 billion-worth of investment up to April 2018, over USD200 million of which is for network expansion and upgrade work on 4G mobile and fixed broadband services. Economynext reports that Sri Lanka Telecom (SLT, incl. Sky Network) – a fixed access provider which also owns a fibre-optic backbone network – has been approved to invest USD79 million to expand its network. Meanwhile, SLT’s mobile arm Mobitel has been given the go ahead to invest USD80 million on its 4G LTE mobile broadband coverage, and mobile operator Hutchison Telecommunications Lanka (Hutch) – which is expected to merge with Etisalat Lanka – has also been approved to invest USD57 million.

According to TeleGeography’s GlobalComms Database, in April 2018 it was revealed that Etisalat Lanka (a unit of UAE-based Etisalat) and CK Hutchison of Hong Kong’s Sri Lankan subsidiary had announced a deal to merge their mobile operations. The merger, which forms part of the Abu Dhabi-based telecom operator’s strategy of portfolio optimisation, was confirmed via the Abu Dhabi Securities Exchange and revealed the aim that it would leave both Hutch and Etisalat Lanka ‘better positioned to serve their Sri Lankan customers’. Upon completion, CK Hutchison will have the majority and controlling stake in the combined entity, although the Securities Exchange filing noted that the merger is subject to several conditions, not least of which are the mandatory competition and regulatory approvals in Sri Lanka. If ratified, the takeover would see the Sri Lankan mobile market – currently led by Dialog Axiata and Mobitel – reduced from five operators to four. Etisalat Lanka currently holds a ten-year licence from the Telecommunications Regulatory Commission Sri Lanka (TRCSL) to operate mobile services, but the concession expires in September 2018.

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