TELEKOM Malaysia Bhd is fairly confident about 2003, expecting a boost to its bottom line from the listing of a South African investment and the strengthening of its cellular unit, on the back of an expected stronger economic outlook.
A thorn, however, is its soured multi-million dollar investment in Ghana Telecom Co Ltd, which threatens to chop RM400 million off its balance sheet.
Telekom chairman Tan Sri Ir Muhammad Radzi Mansor said Telekom has not filed any arbitration proceedings against the Ghana Government to date, although it can. "There has been some delay (in discussions), we believe due to the holiday season. We believe there are still ways to resolve matters amicably. We want to resolve them amicably," he told Business Times in Kuala Lumpur yesterday.
A notification claim sent to Ghanaian officials in September to resolve issues, which lapsed two weeks ago on December 18, gives Telekom the option of pursuing international arbitration if it chooses to.
Muhammad Radzi said there will be new developments to the Ghanaian dispute soon.
He was met at a Telekom employees luncheon in Kuala Lumpur, which also feted some 200 orphans from four orphanages in the Klang Valley, in conjunction with the Hari Raya celebrations.
Telekom, which lost management control of Ghana Telecom in July last year, is trying to get the Ghanaian Government to buy its 30 per cent stake in the Ghanaian telecommunications provider. Telekom paid US$38 million (US$1 = RM3.80) for it in 1997.
The 30 per cent stake is roughly valued at US$200 million, based on what Telekom agreed to pay for an additional 15 per cent stake in 2000.
Telekom is also trying to recover about US$50 million plus US$8 million cash including interest on its deposit or half the agreed price for an additional 15 per cent stake in Ghana Telecom.
The deposited sum paid in August 2000 is believed to have been converted into borrowings for the central-west coast African telecommunications operator, but this has yet to be confirmed.
The investment in Ghana Telecom, held through a 85 per cent-owned unit G-Com Ltd, was one of its largest and profitable ventures in Third World countries.
Telekom booked RM22.9 million profit from Ghana Telecom for the nine months ended September 30 2002, from RM31.5 million in the same period before. Telekom ceased equity accounting profit contributions from Ghana Telecom in the third quarter following the removal of its nominees from Ghana Telecom's boardroom.
Its brighter African star, Telkom South Africa, slated to go public sometime this year, boosted Telekom's bottom line by RM54.9 million for the first nine months ended September 2002. Telekom has a 12 per cent stake in Telkom South Africa.
When announcing third quarter results in November last year, Telekom said it had no new investment in the African region and was working on "improving existing operations in view of exiting at (an) opportune time".
It said it would continue to invest in the fast-growing cellular market locally and in the Asian region where there is growth potential. Telekom closed 35 sen or 4.43 per cent lower to RM7.55 on thin trade yesterday.
