SingTel Executive: Alliances Not M&A To Drive Telecoms Growth

SINGAPORE -(Dow Jones)- Telecommunications companies in Asia face fewer investment opportunities and should look to mobile alliances for growth rather than acquisitions, said a top executive at Singapore Telecommunications.

"There are currently fewer possibilities and opportunities available to operators, with the remaining markets being situated in Central Asia and Africa," said executive vice-president for strategic investments, Lim Chuan Poh, according to the September issue of Singapore Business Review.

"Acquisitions are not the way to go, the global market is already saturated, and even if it wasn't, no single operator could achieve dominance on a global scale.

"The next tier of growth and profit will be achieved through mobile alliances," he said.

OCBC analyst Winston Liew said Lim's comments "make sense" and may indicate SingTel's future growth strategy.

"The past growth model which SingTel used is probably not easy to replicate going forward."

The former local monopoly has spent about S$20 billion building a presence in regional mobile-phone markets, and now has assets in Australia, India, Thailand, Indonesia, the Philippines and Bangladesh.

SingTel's chief financial officer and CEO for international operations Chua Sock Koong said in August that SingTel's focus for new investments remains in Asia.

"Until we have a strategic review that changes our direction, there's no change," Chua said.

Liew said the statements from the two executives are not inconsistent with each other.

"Chua was just saying the current stated corporate strategy. Lim is probably articulating future scenarios that they could adopt."

-By Vladimir Guevarra, Dow Jones Newswires; +65 6415 4155; vladimir.guevarra@dowjones.com

-Edited by Stephen Wright

(END) Dow Jones Newswires"

Posted to the site on 7th September 2006