Thaicom considers pulling investment from Laos, Cambodia

12 Aug 2011

Thailand’s Thaicom (formerly Shin Satellite, part of Shin Corp, itself controlled by Singapore’s Temasek) is considering exiting its telecoms operations in Laos and Cambodia because of tough competition and weak business growth prospects. The newly-appointed CEO of the satellite operator, Suphajee Suthumpun, hinted yesterday that the Thai group would get rid of one or both of its stakes in wireless, fixed line and internet provider Lao Telecommunications Company (LTC) and Cambodian cellco Mfone (formerly Camshin), because poor financial results were negatively offsetting the steadily improving performance of Thaicom’s satellite business. ‘We are pondering many alternatives, including pulling out of there. The decision on this matter should be made soon,’ she said in an announcement quoted by Dow Jones Newswires, adding that ‘we may get rid of them, keep one of them, or keep both; it’s all possible.’

Thaicom’s revenue from telephony services in Laos and Cambodia in April-June 2011 was THB274 million (USD9 million), down by 26.7% compared to THB374 million in Q2 2010, due mainly to lower revenue per minute of usage due to competitive factors. In particular, Mfone faces a price war versus seven operational cellular rivals in Cambodia (eight until the merger of two companies earlier this year, TeleGeography’s GlobalComms Database notes). LTC also faces increasing competition in Laos, although it managed a 12.7% year-on-year increase in subscribers in the year ended June 2011 and currently ranks number one in market share. Thaicom reported a small consolidated group net loss of THB25 million in the second quarter, although this was an improvement from losses of THB155 million in 2Q10.

Cambodia, Laos, Lao Telecommunications Company (LTC), Mfone (formerly Camshin), Thaicom (formerly ShinSat)