Hutchison Telecommunications International Ltd (HTIL) further enhanced its reputation as an emerging markets mobile provider on Wednesday, announcing it will invest US$300 million ($2.34 billion) in an Indonesian 2G network. HTIL's acquisition of 60 per cent of Cyber Access Communications comes on the heels of its US$655 million investment in a Vietnamese CDMA network, in partnership with Hanoi Telecom. Analysts say HTIL's accumulation of business scale in new markets should help parent Hutchison Whampoa offset its own initial 3G start-up losses in Europe and Australia. As Cyber Access has no operations, HTIL is effectively buying the company's combined national 2G and 3G licence from conglomerate Charoen Pokphand Group Indonesia for US$120 million in cash. According to HTIL chief executive Dennis Lui Pok-man, HTIL will also provide Cyber Access an additional US$180 million in investment capital. Charoen Pokphand will retain a 40 per cent stake and cede management control to HTIL. Mr Lui said peak funding for the new company was expected to be US$1 billion, for which it would consider vendor financing. ABN Amro, which has previously provided an $8 billion credit line for HTIL, is the financial adviser for the deal. HTIL chief financial officer Tim Pennington said the company had chosen to expand into what had become its 10th market, because Indonesia had a low 13.6 per cent mobile penetration rate at the end of last year while enjoying a strong subscriber growth of more than 40 per cent. 'This reflects our strategy of expanding the company's business scope into high mobile growth markets in Asia,' he said. Company executives said up to 90 per cent of Indonesia's 30 million mobile users were prepaid customers, who spend an average US$8 to US$9 a month, dwarfed by the US$20 average revenue per user for a contract customer. 'HTIL's strategy is to focus on 2G,' said Mr Lui, adding that it would also operate 3G when the Indonesia business grew. He said there was no conflict between HTIL's business strategy and that of its parent. HTIL will expand into 3G business only from an existing or new 2G investment, while Hutchison Whampoa starts 3G businesses from scratch as it has done in Italy and Britain. An analyst questioned HTIL's investment strategy, saying it was obviously 'defensive in nature'. To begin with, the spinning off of HTIL from Hutchison Whampoa in November last year was a major part of the group's blueprint to plug the 3G earnings gap. 'Now it is making a big fuss out of boosting what it says is hidden value in these new acquisitions. But it indicates that these assets have been listed prematurely,' the analyst said. For example, Hong Kong's 3G mobile business, should have waited until it turned profitable before being spun off separately, he said. Last year, HTIL's Hong Kong mobile division made operating losses of $534 million.