Dividend Chaser on Singtel did not get license for Myanmar contract

(From Article)

Norway’s Telenor ASA and Ooredoo won licenses to expand telecommunications in Myanmar, one of the world’s last remaining untapped markets where only about one in 10 people has a mobile phone.

A France Telecom SA-Marubeni Corp. group was named as a backup in case one of the winners doesn’t fulfill the tender requirements. There were 11 groups in the final round including Singapore Telecommunications, billionaire George Soros and Bharti Airtel. Ooredoo was formerly known as Qatar Telecom.

“The Union Government will now enter the process of finalising” the award of the licenses, it said in a statement. The licenses will be awarded according to a telecommunications law that parliament expects to adopt soon, it said.

The announcement ends a six-month race that drew 91 expressions of interest to operate in the country of 64 million people. The licenses are among the biggest prizes for foreign companies since President Thein Sein moved to allow greater political and economic freedom after taking power in 2011.

“It’s a tremendous growth opportunity, but it will require a fair bit of investment, and returns will be long dated too,” Sachin Gupta, a Singapore-based analyst at Nomura Holdings Inc., said before the announcement. “I don’t think it’s going to be an easy exercise for anyone, but having previous green-field experience and strong local partnership should help.”

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The government proceeded with naming the winners even after parliamentarians moved yesterday to delay the announcement. Set Aung, deputy minister of national planning and economic development who is overseeing the process, said today the process would only stop on Thein Sein’s orders.

Set Aung said that while he’d prefer local companies, the process complied with international practices. Four of the groups had local partners, including those led by SingTel, Digicel Group, Japan’s KDDI Corp. and South Africa’s MTN Group.

“The playing field should be level,” he said. “We, the technical team, aren’t biased in the selection of the winners.”

Myanmar plans to boost telecom coverage to as much as 80% of the country by 2016. It has a mobile-phone penetration rate of 9%, compared to 70% in Cambodia, 87% in Laos and more than 100% in Thailand, the Communication Ministry said in January.