... which eyes Suntel

The others in the running for Suntel include Sri Lanka Telecom and a foreign company.

Dialog Telecom is among the highest bidders for Suntel (Pvt) Ltd, a major player in the CDMA telephone market, with widespread speculation in the stock market that the company raising Rs.20 billion through their rights and preference share issues recently is in fact gearing to buy Suntel.

A stock market analyst told The Sunday Times FT that at the last investor forum called by Dialog, its CEO Dr. Hans Wijayasuriya had said the company only needs Rs. 5 billion for its capital expansion project, but the company had raised an extra Rs. 15 million.

“Through the rights issue held recently Dialog raised Rs. 15 billion and they also issued preference shares worth Rs. 5 billion to selected investors together with the rights issue,” he pointed out, explaining that this entire fund raising activity in the company which brought them Rs. 20 billion ‘extra cash’ was the source of speculation that Dialog was gearing for a major acquisition.
The others in the running for Suntel include Sri Lanka Telecom and a foreign company. Shareholders of Suntel, the pioneer in the CDMA business, are seeking to divest their shareholdings after being 10 years in the business and following a successful year in 2006.

Company sources said Swedish telecom giant Overseas Telecom AB, Metrocorp (Pvt) Ltd, Townsend Ltd of Hong Kong, the National Development Bank and the International Finance Corporation (IFC) are the shareholders exploring the possibility of divesting their stakes.