Viettel’s competitors in Myanmar sell themselves at a cheap price
Telenor will receive payments for the resale of its Myanmar operations over the next five years, Reuters cited the Norwegian telecommunications company’s announcement on Friday when the transaction was completed.
At the time of May 2021, Telenor recorded the value of the Myanmar business as 6.5 billion crowns (about 751 million USD). But then, Viettel’s rival in the Myanmar market was only offered for sale for $ 105 million.
The acquisition includes the participation of Lebanese investment company M1 and local company Shwe Byain Phyu. “Telenor received $50 million at the conclusion of the signing. The remaining $55 million will be received in equal parts over the next five years,” the announcement read.
Due to the current situation in Myanmar, late payment will not be credited to the account. The sale [Telenor Myanmar – PV] accelerated by last year’s military coup in the Southeast Asian country.
Telenor, last week, received approval to sell from Myanmar authorities. This decision emphasizes that the company must leave the country in order to adhere to its values and conduct responsible business. And because local law conflicts with European law. Telenor recorded a cumulative loss of about 800 million crowns in its first quarter account as a result of the reclassification of items previously accounted for by Telenor.
It will also see a negative cash flow impact of 1.5 billion crowns due to “unrecognized cash balances in Telenor Myanmar and closing proceeds”, the company said.
Reuters reported in February that Shwe Byain Phyu, whose chairman has a history of doing business with the military, would own 80% of Telenor Myanmar’s operations while M1 would own the rest. Shwe Byain Phyu has denied having ties to the Myanmar military and has said that it was “chosen by Telenor… because it has nothing to do with the military the most”.
In Myanmar, Viettel does business with the Mytel brand, becoming one of the four largest network operators in this country. The brand name “Mytel” is a combination of “My” in “Myanmar” and “Tel” in “Telecom”. Mytel means telecommunications network for Myanmar people.
The carrier is a joint venture between Vietnam’s Viettel, which contributes 49% of the network’s investment capital, and a consortium of local companies operating under the name Telecom International Myanmar Co., Ltd.
Mytel plans to invest nearly $1.5 billion to deploy 7,200 base stations to build a 4G network. Viettel’s telecom operator in Myanmar aims to reach 90% of the country’s population with 4G coverage when it officially launches in the first quarter of 2018.
Myanmar is Viettel’s 10th international market, and also the market with the largest population and well-invested market. Newly opened, Mytel has fiber optic infrastructure accounting for 50% of total fiber optic cables in Myanmar (36,000km long).
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