Thai, Malaysian firms ink $260m telecoms deal

Thai, Malaysian firms ink $260m telecoms deal

BANGKOK (AFP): Thai mobile phone company, Samart Corp. plc.
yesterday signed a US$260 million strategic telecommunications
tie-up deal with Telekom Malaysia Bhd. at a ceremony here.

Under the agreement, Telekom Malaysia -- which as recently
waged an aggressive expansion campaign in several markets in Asia
and Africa -- takes a 20 percent -- or $71 million -- stake in
Samart.

In addition, the Malaysian firm will assume a 33.3 percent
share of Samart unit Digital Phone Co. Ltd., a statement issued
at the signing said.

The total value of Telekom Malaysia's investment is 6.76
billion baht ($260 million), the statement said.

Analysts said the move would allow Malaysia Telekom to seek
fresh markets, while Samart would benefit from its new partner's
technological knowhow as well as from easier cashflow and more
funds for development.

Participants in the deal and their governments hailed the
agreement as a major step in strengthening ties between the two
firms and between the two neighboring countries.

Telekom Malaysia chief executive Dato' Mohamed Said Bin
Mohamed Ali said the relationship between Telekom and Samart had
brought together two successful telecommunications companies from
neighboring states.

He said he hoped the partnership would "pave the way for more
joint ventures between Thai and Malaysian companies and
businesses."

Thai Transport and Communications minister Suwat Liptapallop
said at the ceremony that the deal was a "significant milestone
in the continuing development and internationalisation of the
Thai telecommunications industry. "

Malaysia's Energy, Telecommunications and Posts minister,
Datuk Leo Moggie said his country "strongly endorsed" the
formation of "this international alliance and investment by
Telekom Malaysia."

"We feel that the spirit of liberalization here parallels our
own in Malaysia," he said.

The firms described the deal as a major "strategic
partnership" between the two firms, aimed at maximizing their
resources.

Samart Executive Chairman Charoenrath Vilailuck said his
company chose Telekom Malaysia as a strategic partner after
"several months" of searching among a number of well-known
international companies in the industry.

"In addition to its strong customer-driven experience and
business performance, Telekom Malaysia shares the same vision as
Samart in spearheading the new convergent industry of computers,
telecommunications and media," he said.

"The alliance is certain to bring the integrated capabilities
of the two companies to bear on a broad range of
telecommunications and electronic commerce businesses in the
future," he added.

Charoenrath said Thailand was "the key to all future growth in
the Indochina region" because of its key geographical position in
Southeast Asia.

All the shares being taken up by the Malaysian firm are
currently owned by the Vilailuck family, which controls the
Samart group, said Sirichai Rasameecham, Samart Executive Vice
President, corporate finance and operations.

He added that some of the funds would go to the construction
of a new group headquarters in Bangkok.

Telekom Malaysia has been steadily expanding its influence and
interests in Asia and Africa in a bid to widen the scope of its
business which would otherwise be hampered by Malaysia relatively
small domestic market.

It has taken up stakes in telecommunications companies in
South Africa, Ghana, Guinea and has also bought into mobile and
wirelesss telephone systems in Bangladesh and Cambodia.