Sri Lanka’s Axiata sounds authorities on possible Airtel take-over
ECONOMYNEXT – Sri Lanka’s Dialog Axiata, the largest mobile operator, has sounded out authorities on a take-over of a unit of Bharti Airtel in the island, Telecom Minister Harin Fernando said.
Dialog Axiata did not comment on the deal, but in December the firm said in a stock exchange filing that it had not "reached material certainty" any merger or acquisition.
Last week Malaysia-based Axiata said it will merge with Airtel operations in Bangladesh.
Airtel was the last and fifth operator to enter and country, which led to a price war and cost-cutting by existing operators as competition increased.
Sri Lanka Telecom group, which own Mobitel is also in negotiations to purchase Hutch, the fourth operator in the island. Majority control of Sri Lanka Telecom is in state hands.
Fernando said the deal is with a cabinet subcommittee which has recommended a valuation.
Some analysts have estimated Airtel to be worth around a 100 million US dollars and Hutch less.
In addition to infrastructure, some of which may duplicate existing networks, the firms also have spectrum.
The deal has run into some controversy amid allegations that attempts were being made to purchase Hutch at an inflated price.