Telecom Sale

March 20, 2007 (LBO) – A Malaysian firm has been given the go ahead to conduct a due diligence of Sri Lanka Telecom (SLT) ahead of a possible sale of a stake held by Japan’s NTT, the company said Tuesday. NTT Communications Corporation of Japan owns a 35 percent stake in Sri Lanka Telecom, but control is still with the Sri Lanka government.

SLT said NTT Communications Corporation was in talks with Global Telecommunications Holdings N.V., which was a subsidiary of Malaysian conglomerate Usaha Tegas Sdn. Bhd, ‘on a possible sell down of part of their holdings in SLT’.

SLT said Global Telecommunications had asked permission to conduct a due diligence exercise and the SLT board had approved it.

Usaha Tegas also controls the Malaysian mobile operator Maxis.

Usaha Tegas is ultimately controlled
by a discretionary trust, the beneficiaries of which are family members of Malaysian businessman Ananda Krishnan Tatparanandam.

Sri Lanka Telecom shares shot up to 44 rupees last month on speculation that a Malaysian party was planning to purchase NTT’s stake for 45 rupees.

At the time however, SLT declined to comment on the deal.

There has been speculation that NTT may sell a stake