Timor-Leste Government to Buy Timor Telecom

Buy subsequent 12 months would finish difficult possession construction of utility which serves 1.5 million inhabitants.

By Macao Information Workers Reporter
October 6, 2022

he Timorese authorities plans to purchase the bulk stake of Brazilian firm Oi in Timor Telecom (TT) in 2023, in an operation valued at about US$14.5 million, an quantity budgeted within the draft state price range for 2023.

Finance minister, Rui Gomes advised Lusa Information Company that negotiations with Oi are ongoing and {that a} “optimistic” result’s anticipated, placing an finish to a course of that resulted from the switch of PT-Portugal Telecom’s capital to the Brazilian firm.

The goal, he defined, is to conclude an operation that features the capital and debt that Timor Telecom has to Oi, an organization that by no means invested within the Timorese operator after incorporating PT’s property, solely taking dividends and curiosity from that mortgage.

Working in Timor-Leste since 2003, Timor Telecom is especially managed by TPT (54.01 per cent); Oi controls 76 per cent of the capital, instantly, and one other 3.05 per cent by means of Participações SGPS.

The remaining shareholders of TPT are the Harii Basis – Society for the Growth of Timor-Leste (linked to the Diocese of Baucau), which controls 18 per cent, and Fundação Oriente (6 per cent).

In TT, the capital is split between TPT (54.01 per cent), the Timorese state (20.59 per cent), the Macao-based firm VDT Operator Holdings (17.86 per cent) and Timorese businessman Julio Alfaro (4.49 per cent).Oi

Through a monopoly that lasted for a number of years – by means of a concession contract with the Timorese authorities that started in 2002 and lasted till 2012 (when the sector was liberalised) – TT was initially managed by PT, a place later acquired by the Brazilian Oi.

In March 2012, the federal government and Timor Telecom signed a Transaction Settlement, which ended the unique concession of telecommunications to Timor Telecom, and marked the opening of the sector to competitors.

Since 2012 TT has needed to compete, in a market of only one.5 million inhabitants, with two different operators, each state-owned, Indonesian Telkomsel and Vietnamese Telemor.

Through the years, first with PT after which with Oi, a number of gives have been made for the sale of the vast majority of the capital, and in 2015 there have been makes an attempt at a joint mobilisation of the state and personal events to maintain the operator as a Timorese asset.

In October 2016, three “agency and binding” gives have been made to Oi to purchase its stake: two by teams led by Timorese businessmen and a 3rd by a Fijian pension fund.

In December of that 12 months the operator introduced it had requested judicial authorisation to promote its stake to the Investel Communications Restricted group, led by Timorese businessman Abilio Araújo, for US$62 million.

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