Fiji telco ATH buys into Papua New Guinea’s ICT market


Fiji-based Amalgamated Telecom Holdings has claimed it has struck a deal to acquire 70 per cent shareholding in each of Digitec Group, which operates in Papua New Guinea, Singapore and Australia. Analysts say the Fijian company could seek a partnership with an existing mobile operator in PNG.

Connection lines around the globe.

Amalgamated Telecom Holdings (ATH), through its subsidiary ATH International Venture, is claiming that it is set to acquire 70 per cent shareholding of each of Digitec Group companies, including Digitec Communications, Etech and Etech ICT for US$13.32 million dollars (K44.93 million), according to a market announcement released last month.

The PNG Investment Promotion Authority has recorded that ATH and Austel Investment are now joint shareholders of Digitec Communications.

ATH is Fiji’s principal telecommunications holding company, owning 100% of Telecom Fiji and Vodafone Fiji. It is owned by the Fiji National Provident Fund (52.2 per cent); 34.6 per cent is held by the government of Fiji and the remainder by other Fijian companies.

The group has three segments: fixed line telecommunications, mobile telecommunications and data and internet services, alongside computer hardware and software, technical support and directory services.

‘The opportunities for ATH in Papua New Guinea are high.’

ATH’s expansion into Papua New Guinea follows acquisitions in 2018 in Kiribati, Vanuatu, Samoa, American Samoa, Cook Islands and New Zealand.

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PNG mobile  entry costs

Lowy Institute’s Shane McLeod

ATH’s full motivations in entering the PNG ICT market are as yet unclear.

‘The opportunities for ATH in PNG are high,’ Lowy Institute analyst Shane McLeod tells Business Advantage PNG.

‘But costs of entry into the mobile market are high and if ATH is seeking to provide a mobile telecommunications service, the most likely scenario would be a partnership with an existing telco.’

He says there has been no mobile tower-sharing history in the PNG mobile sector, and there is no government policy to focus on this as a way of improving access for Papua New Guineans.

‘Therefore, to extend network coverage outside of the major centres, they would need either to build and manage their own network towers—at substantial cost and complexity.

‘Fiji is the leading market to watch in terms of both 4G LTE and 5G development in this region.’

‘Or, they could reach agreement with another operator and share facilities. It seems unlikely this would be Digicel [which launched in PNG in July 2007], because the breadth of their existing network has given them a substantial market.

‘You would expect that the natural partner might be the Kumul Telecom properties, the bmobile-Telikom network.

‘I think it’s unclear that there’s enough appetite for a separate third network.’

Fiji market ‘sophisticated’

ATH may bring in expertise. Fiji hosts ‘a relatively sophisticated communications infrastructure with the highest mobile and internet penetration in the Pacific Islands,’ according to telecommunications researchers BuddeComm.

‘It is the leading market to watch in terms of both 4G LTE and 5G development in this region.

‘In 2019, the Fijian mobile operators continue to heavily invest in 4G LTE and LTE-A technologies, and these networks now account for the largest share of mobile connections.’

What this may mean for business

  1. ATH, which is publicly listed and Fiji’s principal telecom company, holding has a wealth of experience and success in Fiji in providing telecommunications (mobile), as well as equipment. Its acquisitions across the Pacific could mean cheaper pricing in PNG, which could become its biggest single market.
  2. If it seeks a partnership with bmobile-Telikom and applies for a mobile licence, it could provide healthy competition for Digicel.
  3. If ATH partners with a state owned enterprise, it may lead to improvements in their operational efficiency.
  4. Earlier this year, ATH signed a US$43 million (K145 million) financing agreement with ANZ Bank to support its ongoing regional expansion, which can only mean more business for the Pacific Islands. ATH business ventures already comprise Telecom Fiji, Vodafone Fiji, FINTEL, Fiji Directories, ATH Kiribati, Telecom Vanuatu, Datec (Fiji) and its subsidiary Datec Australia, and the Bluesky Group.


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