- Hutch’s parent buys 100% shareholding in Etisalat Lanka completing merger
- Hutch’s parent to hold 85% stake in merged entity; Etisalat Group to hold 15%
The merger of local operations of Etisalat and Hutch announced in April this year has been completed.
A brief statement from CK Hutchison Holdings Limited said Emirates Telecommunications Group Company has completed the sale of 100 percent shareholding in Etisalat Lanka (Private) Limited to Hutchison Telecommunication (Lanka) Private Limited.
“Upon completion of the sale, CK Hutchison Holdings Limited group will have a majority and controlling stake of 85 percent whilst Etisalat Group will have 15 percent ownership of Hutch Lanka,” the statement said.
An industry consolidation was long expected in Sri Lanka’s mobile telephony market, which had five players before the Hutch-Etisalat merger.
“We expect some industry consolidation due to on-going intense competition, especially in the mobile segment; this segment has five operators that face investment requirements that are still high, and the smaller operators are unprofitable,” Fitch Ratings said in a recent
rating report. The merged entity will become the third-largest celco in Sri Lanka with 10-12 percent of market share, ahead of Bharti Airtel’s Sri Lanka unit.
The merged entity will also have spectrum of 50MHz, higher than the market leader Dialog’s 47.5 MHz and equal to SLT— the parent of Mobitel, the second largest celco in the country in terms of subscribers.
The Sri Lankan government in August removed the floor rates on voice calls and said it the move will result in cost optimisation and allow more competition in the sector.