Sri Lankan cellco Mobitel plans for stock exchange listing this year

8 May 2017

The Sunday Times Sri Lanka reports that Sri Lankan mobile network operator (MNO) Mobitel is planning to break away from its parent Sri Lanka Telecom (SLT) and operate as an independent entity in the market, after 14 years of being a subsidiary of the bigger operator. The paper quotes official sources stating that the MNO will be listed on the Colombo Stock Exchange (CSE) in 2017, with the aim of ‘broad-basing the ownership of Mobitel which is a fully owned subsidiary of Sri Lanka Telecom.’ Details of the listing and other steps are yet to be finalised. The decision concerning Mobitel’s future has been conveyed to the Cabinet Committee on Economic Management (CCEM). It is understood that under the plan, the government ‘will exit partially or fully from non-strategic investment in Mobitel and several other institutions including Lanka Hospitals, Hotel Developers PLC (Colombo Hilton), Hyatt Residencies, Waters Edge and Grand Oriental Hotel’.

Minister of Telecommunication and Digital Infrastructure Harin Fernando is quoted as saying that the government has decided to tackle over-capacity in the local market while making Mobitel a strong operator by ‘broad-basing’ the ownership. The overcrowded Sri Lanka mobile industry remains the key medium-term risk to telecom operators in the country, he said, adding that Mobitel would be allowed to operate independently. Mobitel accounted for over 45% of SLT Group revenues last year and it is the highest income earner among SLT’s eight subsidiaries. Mobitel, which started operations in 1993, became a wholly owned subsidiary of SLT in October 2002. The MNO is currently engaged in a network expansion under which it plans to increase the number of base stations from 3,500 currently to 5,300 nationwide – in the process taking coverage to 100% of the population.

Sri Lanka, SLT-Mobitel, Sri Lanka Telecom (SLT-Mobitel)