The owners of Cambodian mobile operator Mfone are considering a number of strategies to strengthen the firm, after the head of the its majority owner said it would contemplate pulling out of the Kingdom.
Thaicom chief executive Suphajee Suthumpun last week said the company was considering exiting Mfone along with Laos Telecommunications Company in the wake of lagging performance at both firms.
“We are pondering many alternatives, including pulling out of there. A decision on this matter should be made soon,” she reportedly said.
“We may get rid of them, keep one of them, or keep both. It’s all possible.”
The comment had raised questions about the fate of Mfone, which saw its subscriber numbers decline 21 percent between the first and second quarters of this year.
However, Thaicom’s CEO was stating merely “the possibility and not the intention” of selling Mfone, said Atip Rittaporn, managing director at Shenington Investments, the holding company under which Thaicom controls Mfone.
“The current situation is not favourable to future operations in Laos and in Cambodia, so we have to make a move. If there are interested parties, we are open to the possibility of discussion,” he said yesterday.
Thaicom controls 51 percent of Shenington Investments, which owns 100 percent of Mfone. The remaining 49 percent of Shenington is held by Asia Mobile Holdings, a joint venture which is 75 percent held by Singapore Technologies Telemedia (STT) and the remainder by Qatar Telecommunications..
Atip Rittaporn said Thaicom could also buy out Mfone’s other shareholders, though that strategy “has not been explored” yet.
He also sought to temper speculation about Mfone’s future, saying the company has for some time been researching its options so as to better position itself in the market. He cited previous merger talks with Hello and qb as specific examples of actions Mfone has taken, though those talks eventually fell through.
While qb officials could not be reached for comment yesterday, Hello CEO Simon Perkins acknowledged that discussions with Mfone had taken place previously. However, he reiterated his previous statement that Mfone had not since approached Hello about a possible merger.
Atip Rittaporn also said that while he could not comment for STT, he assumed they were committed to Mfone’s success.
“I don’t think they’re going to be away from Cambodia. They still have a very strong intention to stay in this market.”
Mfone CEO Yap Wai Khee said yesterday that strong support from its shareholders was “one of the key strengths” the company can leverage.
“Therefore, Mfone does not foresee any impact on its operations from the potential exit of a shareholder,” he said.
He called the shareholders “very supportive,” saying: “The decision whether to sell or not will probably be based on value creation to the shareholders, and also creating a much better and stronger Mfone in the future.”
Just who in fact buys Mfone, if a sale takes place, is up to those shareholders, he said.
Yap Wai Khee defended his company’s performance, citing Mfone’s near 20-year history in the Kingdom and its “sizeable loyal and high ARPU [Average Revenue Per User] customers”.
He blamed the decline in subscribers to other telcos not following the Ministry of Post and Telecommunications prakas on minimum pricing, which allowed competitors to draw away customers from Mfone.
Still, he claimed “most revenue generating subscribers stayed with Mfone”.
“Mfone as a standalone business is financially feasible,” he said.
Officials at STT said they had no comment about a potential sale of Mfone, while Thaicom officials did not immediately return a request for comment.