Fattouch Investment has no plans to sell VivaCell network

13 Jul 2007

The owner of Karabakh Telecom (K-Telecom’s) Lebanese parent company, the Fattouch Investment Group, says it has no intention of exiting the Armenian telecoms market, scotching an earlier press rumour suggesting that Russia’s largest mobile operator MTS had offered to purchase the company’s VivaCell mobile network. In a meeting held yesterday to celebrate the second anniversary of VivaCell’s launch, Pierre Fattouch said the Lebanese group had already invested about USD340 million in its Armenian wireless network and had plans to further expand its operations in the country. Fattouch also revealed that VivaCell has broken the one-million barrier for mobile subscribers, giving it a commanding 70% share of the local wireless market. ‘The one million is just the beginning and we are actively expanding our network to a capacity of 1.5 million subscribers as well as preparing the launch of third-generation services,’ he said.

According to TeleGeography’s GlobalComms database, Armenia’s second mobile network operator K-Telecom entered the market on 1 July 2005 when it launched commercial GSM-900/1800 services under the trademark VivaCell. K-Telecom was licensed by the Armenian government on 4 November 2004, with the state issuing no official explanation as to why it awarded the USD7 million wireless concession without a competitive tender. The arrival of competition led to an explosion in mobile phone use in the country as fierce competition between ArmenTel and VivaCell dramatically reduced the hitherto high cost of mobile services.