Millicom has sold a 78 percent stake in its Laos mobile network (‘Millicom Lao Co.’) to Russia’s VimpelCom for US$66 million. The purchase price represents an enterprise value of US$102 million with the Lao government retaining the remaining 22 percent. “Laos provides a great complement to our existing operations in Vietnam and Cambodia and fits perfectly into our strategy of building a solid Southeast Asian cluster,” said VimpelCom CEO Boris Nemsic in a statement. He noted that Laos – with a population of 6.5 million and a mobile penetration rate of only 23 percent – represents high-growth potential. The acquisition is subject to regulatory approvals but is expected to close before the end of the year. According to Wireless Intelligence data, the network is the second-largest in Laos and had 279,000 connections by the end of 2Q09.
Luxembourg-based Millicom put its three Asian mobile networks – Laos, Tigo in Sri Lanka and Cambodia’s Cellcard – up for sale in early July. The three networks generated a net profit of US$4 million in the first quarter of the year and revenues of US$68 million, the company said in a statement at the time. The Sri Lankan business has generated particular interest with a number of international operators understood to be preparing bids, including India’s Bharti and BSNL, Japan’s NTT Docomo and Etisalat of the UAE.