ETL

[YONGYEE]

Govt to sell 30 percent share in ETL

The Lao government plans to sell 30 percent of its shares in the Enterprise of Telecommunications (ETL) Laos in the middle of next month, as part of its efforts to restructure the state owned enterprise.


ETL headquarters in Vientiane. The state owned enterprise will become a public company after the government sells 30 percent of its shares to local and foreign investors.

ETL Director General Mr Khammouane Xomsihapanya said on Friday that the company is preparing to issue its initial public offering (IPO), hoping to sell the shares by mid-September.

“We will issue the IPO on September 15,” Mr Khammouane said in an interview with Vientiane Times after attending a seminar on Vietnam's equitisation of state owned enterprises at the Lao stock market building in Vientiane.

He said ETL has been registered as a public company since July 11 and expects to list on the stock market on November 11, after completing the sale of 30 percent of government shares to the public.

Mr Khammouane said that 5 percent of shares will be sold to staff of the company, 15 percent to local investors and 10 percent to foreign investors, while the government will retain the remaining shares in the company.

About 23 million shares of the ETL will be on sale, at an unofficial price of 4,500 kip per share.

He explained that the government expects to raise about 103 billion kip from the sale of its ETL shares to the public, and these funds will be used to expand and improve the telecom business.

He said ETL has met all requirements to becoming a public company and listing on the stock market, adding that the company has made a continuous profit from its cell phone services amid growing competition in the telecommunications market in recent years.

The company expects to achieve a net profit of about 40 billion kip in 2011, Mr Khammouane said.

According to the ETL Director General, the company has a market capital of around 260 billion kip, has around 960,000 subscribers and a market share of about 35 percent in the telecommunications sector.

About 70 percent of the company's revenue comes from monthly cell phone subscriptions, with the remainder mostly from home phone and international connection services.

ETL plans to launch 3G services at the end of this month, aiming to attract customers amid the flourishing cell phone service market in the country of about 6.5 million people.

There are currently four telecom companies operating in Laos – ETL, Lao Telecom, Star Telecom and Vimpel, which recently purchased a majority shareholding in Tigo from Millicom International Cellular.

At present, there around 5.4 million mobile phone subscribers in Laos, accounting for about 83 percent of the population, and mobile phone networks reach 6,712 villages throughout the country.

The Ministry of Post, Telecom and Communication recently ordered all telecom service providers to stop special promotions such as offering free call credit, SIM cards and text messaging credit in a bid to attract more customers, fearing the fierce marketing competition was affecting their business performance.

By Times Reporters
(Latest Update August 23, 2011)