Jio Platforms, the telecom arm of Reliance Industries Ltd (RIL), is among the three entities that have expressed interest in acquiring Sri Lankan government's stake in Sri Lanka Telecom PLC, the state-owned telecommunication company.
Colombo had invited proposals from potential investors from November 10 onwards, as it decided to divest its stake in the national telecom services provider.
After the deadline for the submission of proposals ended on January 12, the Sri Lankan government issued a press release, mentioning Jio Platforms, along with Gortune International Investment Holding Ltd, and Pettigo Comercio International LDA as the three potential bidders.
Their proposals will be "evaluated as per the Special Guidelines on Divestiture of State-Owned Enterprises approved by the Cabinet of Ministers", it added.
The International Finance Corporation is the transaction advisor for the sale of the government's stake in the PSU telecom firm, which does business under the brand name of SLT-MOBITEL.
At present, Sri Lanka's Secretary to the Treasury holds the controlling stake of 49.5 percent in the company, whereas, the Amsterdam-based Global Telecommunications Holdings owns 44.9 percent. The remaining stake is held by public shareholders.
Also Read: Reliance Jio Q2 net profit jumps 12% YoY to Rs 5,058 crore; ARPU at Rs 181.7
The stake sale comes at a time when the financially-stressed Sri Lankan government is looking to privatise several sectors of the economy to raise capital and increase efficiency.
The island nation is also mandated by International Monetary Fund (IMF) programmes to push for privatisation of non-core sectors.
For Jio, the potential investment assumes significance as the telecom services provider is already the market leader in India. The acquisition of the government's stake in Sri Lanka Telecom could allow the company to gain a strategic foothold in the neighbouring market.
As per the latest figures released by the Telecom Regulatory Authority of India (TRAI), Jio added 31.59 lakh mobile users in October 2023, whereas, its nearest rival Bharti Airtel gained 3.52 lakh. With this addition, Jio's overall wireless subscriber count jumped to 45.23 crore in October from 44.92 crore in the previous month.
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