Viettel’s Myanmar venture moving slower than expected

According to the March press release of the joint-venture committee, Myanmar’s fourth mobile operator should have applied for its license by the end of June. However, as reported by Myanmar Times, the parties involved, namely Viettel, government shareholder Star High Public Company Limited, and local consortium Myanmar National Telecom Holding Public Limited, are still at the negotiation table.

The paper cited an insider source as saying that the parties have not agreed on how votes will be split between the board and executive staff. The new joint venture’s board will be dominated by partners from Myanmar, but it is likely that Viettel side will delegate a CEO, subject to board approval, just like it has done in other countries.

Another challenging item on the agenda is financing. The source said that the three parties together had financial firepower, but that it remains a question whether they felt comfortable pooling their resources into a project that could be very challenging in a maturing market.

If a fourth nationwide license is granted, the new mobile operator will have to compete with state-owned Myanmar Posts and Telecommunications (MPT) and foreign firms Ooredoo and Telenor. At the end of the first quarter of 2016, there were about 42 million mobile subscribers in Myanmar, accounting for 78 per cent of the country’s population. MPT had a 46 per cent market share, followed by Telenor’s 37 per cent, and Ooredoo’s 16.5 per cent.

In April, Viettel announced that it would invest $1.5 billion in Myanmar to build the country’s fourth mobile network, the biggest among all of the company’s foreign markets to date. The title formerly belonged to Tanzania where Viettel put down $1 billion.

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