KUALA LUMPUR (Jan 29): Axiata Group Bhd’s unit is taking up an 80% stake in a Laotian telecommunications infrastructure services provider for 12.8 billion kip (RM6.08 million).

The group said its 63%-owned subsidiary edotco Group Sdn Bhd —  through wholly-owned edotco Investments (Labuan) Ltd — is buying the stake from Viphet Sihachakr and Mekong Tower Company Ltd (MTCL).

In a filing today, Axiata said the move provides edotco Group with opportunities for expansion into new markets, and engage in organic growth via its build-to-suits and inorganically with its sizeable scale-and-leaseback prospects.

It added that the Laotian tower market is expected to have intensive growth, in tandem with its national drive towards the adoption of 4G technology.

“The Laos tower market is expected to undergo intense growth in tandem with a national drive towards 4G adoption, with an estimated demand of no fewer than 5,000 towers over the next three years, underscoring the need for an independent tower player to meet the requisite capex and cost optimisation burdens incumbent on local MNOs,” said Axiata.

The deal is contingent on the registration of MCTL with the Laotian Ministry of Industry and Commerce, and Viphet procuring viable business, inclusive of relevant concessions and incentives, in Laos.

Both parties have six months to satisfy the conditions of the agreement.

Shares in Axiata closed at RM3.96, down 18 sen or 4.35% from yesterday, giving the group a market capitalisation of RM37.56 billion.