US$ 75 m syndicated loan:

SLT to inject Rs 5 b into Mobitel

Ravi LADDUWAHETTY

Sri Lanka Telecom (SLT), will inject Rs 5 billion into its wholly owned subsidiary Mobitel ( Pvt) Ltd on a staggered basis over the next six months for an ambitious modernization program of its countrywide network and also to expand its coverage. The expansion program is expected to be completed by end 2011, which is also the end of the financial year of Mobitel, will also see the stage set for the Mobitel subscriber base to be increased from the present 4.2 million to the 5 million mark, Sri Lanka Telecom and Mobitel Chairman Nimal Welgama told Daily News Business yesterday.

The expansion program will be funded by a US$ 75m syndicated loan which will be got from a consortium of banks where Bank of Ceylon will be the lead bank along with the Hatton National Bank and Commercial Bank, The US$ 75 million loan which translates to over Rs 7.5 billion is under negotiation at present and Rs 5 billion will go into the Mobitel expansion program while the remainder of Rs 2.5 billion will go into the expansion of the Sri Lanka Telecom Broadband network, the SLT and Mobitel Chief said.

Sri Lanka Telecom’s Chief Financial Officer (CFO) Shiron Gooneratne said SLT infusion of capital into Mobitel will be spread into two stages and Rs 2 billion will be invested in the third quarter while the remaining Rs 3 billion will be invested in the fourth quarter.

The project will also aim to take Mobitel Broadband to the next generation and the operational details are being finalized.

There will be the additions of 1,000 base stations which will be added countrywide while the GSM and the HSPA coverage will also be expanded.

Mobitel’s Engineering and Operations Senior General Manager Lasantha Hettithantri said the Mobitel expansion will also see that blanket coverage will be provided to the Jaffna peninsula and the East coast which will also be in consonance with the government’s resettlements in the Vanni region and giving islandwide coverage to all areas will also be the key focus of the expansion program.

The expansion program will see the addition of 750 GSM base stations along with 250 3G Node B, which will be acquired from the Chinese supplier ZTE, will see that they will be up-gradable to be LTE (Long term Evolution) enabled which will be the next generation of mobile telephony, he said.

Gooneratne said the SLT expansion will be in the areas of broadband where the coverage in the rural hinterlands will be upgraded.

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