New source from Dow Jones mentioned that Turkcell (Turkey's leading mobile telephone operator) has decided not to bid in Pakistan Tel Privatization. Currently, potential suitors are China Mobile(Hong Kong) Ltd, Telecom Malaysia(Malaysia), Singtel(Singapore), Kuwait Mobile, Emirates Telecommunication, Saudi Oger and Saudi Telecom. The winner of the bid will have management control of the company.
Comment: I think it will be the second company that Singtel will have management control if they win the bidding. The one first is Optus as the rest of the acquisition in Asean region is only a stake in the company. I think it will be a good acquistion for Singtel as the penetration rate is low and it would increase their oversea profit. (Let hope it does not over pay and the market react by dumping Singtel Stock)
Comment: I think it will be the second company that Singtel will have management control if they win the bidding. The one first is Optus as the rest of the acquisition in Asean region is only a stake in the company. I think it will be a good acquistion for Singtel as the penetration rate is low and it would increase their oversea profit. (Let hope it does not over pay and the market react by dumping Singtel Stock)
5 comments:
26% stake, may not hv mgmt control
Source From: Channel New Asia
Sunday June 19, 2:17 PM
SingTel loses bid for stake in Pakistan Telecom to UAE's Etisalat
ISLAMABAD - Pakistan Saturday sold a 26 percent stake in its largest telecom company for 2.59 billion dollars to Etisalat of the United Arab Emirates after a standoff with workers delayed the sell-off.
Etisalat's offer of 1.96 dollars a share for Pakistan Telecommunication Co. Ltd. (PTCL) outbid those of China Mobile and SingTel which offered 1.06 dollar and 0.88 dollar a share respectively.
"We are very happy over the bid which is beyond our expectations," Pakistani minister of information technology, Owais Leghari, said.
SingTel's spokesman Peter Heng had extended congratulations to Emmirates telco Etisalet on winning the bid.
Troops and police seized control of the firm's premises on June 12 following the government's announcement the previous day that bids would be invited for the 26 percent stake.
Union leaders threatened to paralyze services if the decision was not withdrawn by last Wednesday.
Trade unions said around 400 of their senior members had been arrested as the government sought to crack down on disruption ahead of the planned sale.
The government earlier postponed the sell-off to end a 10-day standoff with 55,000 PTCL workers.
On Saturday PTCL workers staged a string of small demonstrations in several cities across the country, as security forces guarded key installations of the telecom's company.
Officials have said profit-making PTCL faces the possibility of a sharp decline in its revenues as private sector mobile phone companies spark intense competition in the telecom market.
PTCL has 5.05 million fixed phone clients whereas the number of cellphone users has risen to 10.54 million in the past few years.
The phone company earned 29 billion rupees (483.33 million dollars) in profits for the year ended June 2004. It has total of 1.39 billion shares with a current market price of 71.50 rupees (1.20 dollars) a share.
Since its formal launch in the early 1990s, the telecom firm's privatisation faced setbacks because of the US-led military operation in neighbouring Afghanistan, near-conflict with India in 1999 and 2002, and international sanctions against Pakistan arising from its 1998 nuclear test.
Privatisation Minister Hafeez Shaikh called it "a big success" for Pakistan.
Etisalat will have to deposit 30 percent of its bid price within 15 days and the rest would come within three months after formal approval of the deal.
"We would forward the bid to the cabinet on Monday for formal approval of the government," Shaikh said.
Pakistan has raised more than 105 billion rupees (1.75 billion dollars) in the past three years by selling state assets.
As one of the largest corporate entities in Pakistan, PTCL accounts for about 15 percent of the weighted-average index of 100 shares at the Karachi Stock Exchange.
COMMENT: Woah, almost 2.3 time higher than Singtel bid. Recently, wealthy countries in Middle East are very aggressive in acquisition. It will be a challenge to Singapore company who want to expand in oversea market. Recent case of in Hong Kong Port (PSA) and now telecom sector. I wonder how the market will react tomorrow.
That's fast.
Haha... saw the news on TV also. I hope the mkt react positively, ie. price goes up, since the last time it came down when SingTel announced their acquisition plans :)
If it comes down, buy (tgt $2.55). If it goes up, sell (tgt $2.68)
Closed at $2.66. Investors must be very happy Singtel didn't succeed in the Pakistan acquisition. I guess investors do not hv a lot of faith in the Pakistan economy, it being in the heart of the Osama led terrorist hideaway and also the recent strike by the Pakistan Telecom staff. Yes, the 35% wage hike for the staff (they were striking cos' they were promised "ONLY" 30%) sounds a bit worrisome but it could be due to runaway inflation there
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