No Sale

Jan 15, 2010 (LBO) – Hutchison Telecom International’s Sri Lanka unit will stay with the group, with new investments planned to increase coverage, while the parent is being de-listed from the Hong Kong stock exchange, an official said.

Sri Lanka’s mobile market is shared between Dialog Telekom, a unit of Malaysia’s Axiata, Mobitel a unit of local fixed access operator Sri Lanka Telecom, and Tigo, a unit of Emirates based Etisalat and India’s Bharti Airtel.

The larger operators are moving into mobile broadband and value services as a price war has pushed operators into losses. Hutchison Sri Lanka says it will focus on voice and text messaging.

“In the foreseeable future voice and text messages will generate the lion’s share of revenues for celco’s here,” the official said.

“Broadband is expensive to invest and takes a long time to pay back. Celco’s like other businesses have to make money and do justice to shareholders.”

Sri Lanka’s price war started with the entry of Bharti Airtel, which saw existing operators slashing prices starting with a package aimed at state workers by Mobitel.

Hutchison Whampoa, the ultimate parent of the group, has made a general offer to Hutchison Telecom International to buy the