Thursday, December 15, 2011

Axiata subsidiary Dialog buying Sri Lanka Suntel for up to US$34.9m

KUALA LUMPUR (Dec 15): Axiata Group Bhd's subsidiary Dialog Axiata PLC is buying Sri Lanka's leading fixed telecommunications provider Suntel at an enterprise value of between US$33.9 million (RM107.84 million) and US$34.9 million cash pending a due diligence.

Axiata said on Thursday the acquisition of Suntel by Dialog's fixed line subsidiary Dialog Broadband Networks (Private) Limited (DBN), provides the Dialog Axiata Group with a much enhanced leverage and footprint in the fixed telecommunications market space in Sri Lanka.

'The acquisition also provides an avenue for the Dialog Group to benefit from the integration with Suntel's best in class fixed line operations framework,' it said in a statement to Bursa Malaysia.

Axiata said the acquisition of Suntel would be undertaken wholly in cash which will be funded through internally generated funds.

Under the deal, DBN wold acquire the Suntel shares from Overseas Telecom AB; Metrocorp (Pvt) Ltd.; Telecom Venture Group Ltd.; International Finance Corporation; National Development Bank PLC; C Tech Investments (Pvt) Ltd.; and Kelmarsh Investments Ltd.

Axiata said DBN was buying the shares 'at an enterprise value in the range of US$33.9 million and US$34.9 million, corresponding to a valuation multiple of 3.0 times to 3.1 times of the EBITDA of Suntel for financial year ended Dec 31, 2010'.

It added the final pricing would be determined by the outcome of confirmatory business valuation and due diligence during the period leading up to the completion of the transaction.


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