SingTel's entry through stake in PBTL promises to shake up fast-growing market
Bangladeshi telecommunications players are bracing for a price war following the entry of Singapore Telecommunications (SingTel) into the country's fast-growing mobile phone market earlier this month.
SingTel has announced an acquisition of a 45 per cent stake in Pacific Bangladesh Telecom Ltd (PBTL) for US$118 million. Under the agreement, SingTel has an option to buy another 15 per cent of the country's oldest mobile phone operator, which operates under the brand name of City Cell, for an additional US$65 million. The option could be exercised between April and June 2007.
PBTL vice-chairman Faisal Morshed Khan, who signed the deal with SingTel, said that the Singaporean giant also would invest US$150 million to expand City Cell's 12-year-old network to cover another 3.5 million prospective subscribers.
Despite being the oldest mobile operator, City Cell, which has 350,000 subscribers, trails GrameenPhone (GP), with more than 3.5 million subscribers. GP, which is 60 per cent owned by Nortel, is followed by AKTel, with 1.7 million subscribers.
Mr Khan hopes that with SingTel, his company can become the No1 operator in the country in the next two to three years.
However, industry analysts believe that with GP and AKTel enjoying a big lead, Mr Khan's task could be a daunting one.