Maxis insists on management control of Sri Lanka Telecom

Global Telecommunications Holdings (GTH) of Malaysia, which owns Malaysian telecom giant Maxis - the potential buyer of the 25.3 percent stake in Sri Lanka Telecom (SLT) -, is insisting on full management control including the handling of finances of SLT, informed sources said.

Maxis wants its own Chief Executive Officer (CEO), Chief Finance Officer (CFO), and Chief Operations Officer after acquisition of the SLT stake. The GTH/Maxis-NTT deal is to be completed next week because of certain matters that had to be attended to, before the finalization of this transaction, the sources said.

The seller NTT – which has 35.2 percent (625million shares) in SLT – benefited hugely on Friday when shareholders at the SLT AGM approved the dividend payment of Rs 1 per share. NTT will thus receive Rs 625 million from this payment. There was speculation that the share transaction was delayed in view of this impeding development.

The Sunday Times FT reliably learns that the financial transaction will take place through a leading foreign bank as GTH – which is Netherlands-based – is to send the money from its Dollar account in a Dutch bank in the Netherlands.

A Sri Lankan associate of Maxis is now in Malaysia to discuss modalities of handling SLT operations after the completion of the transaction. A senior SLT official told The Sunday Times FT that no decision was taken on the appointment of a new CEO as a new shareholders agreement should be put into place after finalizing the NTT stake. The new organisation structure of the SLT was approved at a crucial board meeting of the SLT Board of Directors held last Monday to take important decisions on the restructuring process of SLT with a view to transform it into a global IP solution provider and sustain the growth of the company. The management contract ends on March 31. The number of heads of divisions has been increased from 47 to 58 with some employees saying this will create an additional burden to the company.