July 20, 2010 (LBO) - Sri Lanka's Etisalat unit said it was spending 163 million US dollars to expand its network into war ravaged north of the country and improve its broadband services in urban areas.
The expansion will see 480 new base stations taking the total to 1580, which the firm says will be the largest in the island.
"We are investing 163 million US dollars (18.5 billion rupees) to expand base stations and bring HSPA 28.8 megabits per second.
"We are bringing coverage investment, distributed all over the country with special emphasis on the North and the East," chief executive Duminda Ratnayaka said.
Ratnayaka said expansion of its broadband services will see HSPA (high speed packet access) technology with 28.8 megabits per second speeds.
Over 500 third generation (3G) base stations will be built on existing locations.
Alcatel-Lucent has been chosen as the vendor.
UAE-based Etisalat bought the Sri Lanka unit from Millicom Cellular International when it exited Asia.
The firm says the expansion will be funded by debt at 'attractive terms' as the firm was virtually debt free and its parent is rated A+ by Fitch Ratings.
"We are virtually a debt free company,' deputy chief executive Riyaz Rasheed said.
"Given our status as a debt free we have managed to finalize the funding."
The firm said its subscriber base was now close to 3.0 million.
Ratnayaka said a recent floor price set by the regulator was beneficial to "both the consumer and operator."
"The operator has to have a healthy business to ensure that good services are delivered to the consumer," Ratnayaka said.
Sri Lanka's Bharti Airtel unit has petitioned courts over the move. Sri Lanka's 15 million subscriber market is shared between Dialog Axiata, Sri Lanka Telecom Mobitel, Airtel, Hutch and Etisalat.