Mobitel to be split from SLT and publicly listed
In this article (5)
Sri Lanka’s Mobitel plans to separate from parent company Sri Lanka Telecom (SLT) and list on the Colombo Stock Exchange.
The operator is gearing up for a public listing this year with the goal of diversifying its ownership beyond SLT, citing official sources.
The government of Sri Lanka, which owns a 49.5% stake in SLT, plans to exit partially or fully from Mobitel as part of a broader sell-off of its investments in state-owned enterprises.
The government is seeking to raise at least $1 billion to settle what it says is uneconomical debt it inherited from its predecessor.
Minister of telecommunications and digital infrastructure Harin Fernando meanwhile told that the separation is also aimed at helping tackle overcrowding in the nation’s telecoms industry and improving the competitiveness of Mobitel.
Mobitel commenced operations in 1993 and became a fully-owned subsidiary of SLT in 2002. The company currently accounts for around 45% of SLT’s annual revenues, the highest contribution among the group’s eight subsidiaries.
Questions & Answers
Q.What is the primary reason for Mobitel's planned separation and listing?
What is the primary reason for Mobitel's planned separation and listing?
The operator aims to diversify its ownership beyond its parent company, SLT. This move aligns with the Sri Lankan government's broader strategy to sell off its investments in state-owned enterprises and raise funds.
Q.Why is the Sri Lankan government selling its stake in state-owned enterprises like Mobitel?
Why is the Sri Lankan government selling its stake in state-owned enterprises like Mobitel?
The government is seeking to raise at least $1 billion. This capital is intended to settle what it describes as uneconomical debt, which it inherited from the previous administration.
Q.What impact is the separation expected to have on Sri Lanka’s telecoms industry?
What impact is the separation expected to have on Sri Lanka’s telecoms industry?
The Minister of Telecommunications and Digital Infrastructure indicated that the separation is intended to help address overcrowding within the nation's telecoms sector. It also aims to improve Mobitel's overall competitiveness in the market.
Q.How significant is Mobitel to its current parent company, SLT?
How significant is Mobitel to its current parent company, SLT?
Mobitel is a very significant contributor to SLT's financial performance. It currently accounts for approximately 45% of SLT’s total annual revenues, making it the highest contributor among the group's eight subsidiaries.
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