Dialog shareholders approve Rs. 15.5 billion Rights Issue
Telekom Malaysia (TM) to inject Rs.13 billion in FDI:
DISCUSSION: Minister of Enterprise Development and Investment
Promotion Dr. Sarath Amunugama held discussions with Chairman,
Dialog Telekom Muhammad Radzi bin Haji Mansor and CEO, Dialog
Telekom, Dr. Hans Wijayasuriya, on new investments in the
telecommunication sector. Non-Executive Director, Dialog Telekom,
Prahar Nagalingam Kirupalasingam, looks on.
RIGHTS ISSUE: Dialog Telekom Ltd. (DTL), announced that the
shareholders of DTL, at its AGM held on May 21, 2007, approved the
companyâ€™s landmark Rights Issue to a value of Rs. 15.5 billion.
The Dialog rights issue represents the single largest equity raising
exercise to be executed on the Sri Lankan capital market.
Dialogâ€™s principal shareholder Telekom Malaysia (TM) placing a strong
vote of confidence in Sri Lanka and Dialog Telekom has pledged to
enhance its direct investment in the country through subscribing in full
for its entitlement under the rights issue.
â€śWe have the utmost faith in the Sri Lankan market, the investment
environment facilitated by the Government of Sri Lanka, and the enabling
environment we have enjoyed under the aegis of the Telecommunications
Regulatory Commission, the BoI and the Ministry of Mediaâ€ť said Yusof
Annuar Bin Yaacob - Chief Executive Officer of TM International Sdn Bhd,
commenting on Telekom Malaysiaâ€™s commitment to invest Rs. 13 Bn in DTL
via the Rights Issue.
â€śWe will continue to invest in Sri Lanka as we have done in the past
with the objective of providing excellent and technologically advanced
services to the Sri Lankan consumerâ€ť he added.
The rights issue will provide ordinary shareholders of the company
with an entitlement to one ordinary share for every ten ordinary shares
held, at a price of Rs. 21 per share.
The Dialog Telekom Rights Issue is expected to attract substantial
interest from Dialogâ€™s shareholders spanning foreign institutional,
domestic institutional and domestic retail segments.
The proceeds of the Rights Issue and Preference Share Issue totalling
around Rs. 20.54 Billion will partially finance the Dialog Groupâ€™s
aggressive capital expenditure plans for the next three years targeting
accelerated expansion of network capacity and coverage and
transformational investments in convergent technologies spanning the
multiple businesses lines of the group.
Dialogâ€™s investments in Broadband, fixed wireless, and Media are
expected to deliver the next phase of growth and supplement the already
robust returns delivered to its shareholders, whilst contributing
significantly to the communication infrastructure of Sri Lanka.
The performance of the DIAL share has been a key driver of the
buoyancy and growth of the CSE and associated indices.
The DIAL share rose by approximately 117% during the 22 months
following the companyâ€™s listing in July 2005.
Presently DIAL accounts for 22% of the market capitalization of the
The proposed financing exercise forms a part of a larger medium term
funding programme, which would include further local and off-shore debt
infusions aimed at maintaining an optimally geared capital structure.
The rights issue is supplemented by a Rated Cumulative Redeemable
Preference Share Issue of up to Rs. 5 Bn.
The RCRPS are non-convertible and carry no voting rights. The 5
Billion RCRPS issued at Rs.1/- each will be placed with selected
investors possessing the requisite scale, through a private placement.