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Wednesday, June 19, 2024

Govt Acquires Beeline for 22 Million USD

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In a USD $22 million deal purchased from a Russian investor last week, the government has acquired full ownership  of the telecom operator VimpelCom Lao Co., Ltd. also known as Beeline.

Deputy Minister of Finance, Mr Sila Viengkeo, a government representative, signed the deal with VimpelCom Lao Co., Ltd. Representative, Mr Richard James, procuring the remaining 78 percent of the telecom’s shares.

According to the Director General of the Planning and Cooperation Department, Ministry of Post and Telecommunications, Mr Phoukhong Chithoublok, the takeover was based on the company’s debt-free status.

The buyout was in response to a proposal made by the investor as part of a plan to  withdraw from the region, with the investor already withdrawing operations in Vietnam and Cambodia. The purchase now means the Lao government holds a 100 percent stake in the company.

Payment will be completed over two periods, with the first payment of US$13 million to be paid within 60 days after signing the deal. The remaining USD $9 million will be made within 120 days.

Once all payments are made, the government will take over the administration and operation of the company.

Currently, the company’s network covers 11 out of the country’s 18 provinces and plans to expand its network coverage to all provinces.

As of September 2017, the company had more than 260,000 registered mobile phone users and 2,200 cable internet users.

The takeover of the company comes as the government is making reforms in state-owned enterprises while in contrast seeking joint ventures by selling stakes in other enterprises.

A Chinese investor recently purchased a 51 percent stake in Enterprise of Telecommunications Lao (ETL) Public Company with the Lao government holding the remaining share. The company was then named Enterprise of Telecommunications Lao (ETL) Co., Ltd.

The government is also seeking a business partner to create a joint venture in the state-owned Lao Airlines.

Except for VimpelCom Lao Co., Ltd., and Sky Telecom, which provides only internet services, all three remaining telecommunication companies are joint ventures.

Lao Telecom and Star Telecom have 51 percent stakes each held by the government, while Enterprise of Telecommunications Lao (ETL) Co., Ltd. is 49 percent owned by the government.    

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