IFC provides USD100m finance package to Dialog, takes small stake

The International Finance Corporation (IFC), the private sector arm of the World Bank, yesterday agreed to provide Sri Lanka’s biggest mobile phone operator, Dialog Telekom, with a USD100 million financing package. The IFC agreed to lend Dialog USD70 million, while the balance will be used to buy shares from Dialog’s parent company, Telekom Malaysia. ‘Our investment in Dialog is the largest we have ever made [in Sri Lanka], where we currently have an exposure of just over USD90 million in telecoms, ports, financial services and power,’ the IFCs Country Manager for Sri Lanka, Gilles Galludec, told reporters. As part of Monday’s deal, Telekom Malaysia sold a 1.6% (out of a total 89%) stake in Dialog to the IFC for USD15 million, and signed a call agreement to allow the bank to buy an additional USD15 million worth of shares at a future date.’ Dialog’s CEO Hans Wijayasuriya said the money will be used to expand its networks, particularly in rural areas. ‘We hope to have 100% population coverage within the next twelve months, from 90% we have now,’ Wijayasuriya said, before adding: ‘About 60% of our USD450 million investment pipeline for the next two years will go into mobile, the rest into new areas like WiMAX, cable TV, fixed line telephones and our internet business.’