Increased stake in Vodafone Fiji seen as good for FNPF
A communications analyst says the Fiji National Provident Fund's decision to increase its stake in Vodafone Fiji is a solid investment.
A communications analyst says the Fiji National Provident Fund's decision to increase its stake in Vodafone Fiji, is a solid investment.
After 20 years in Fiji, Vodafone has sold its 49 percent stake to the Fund for US$87.9 million, meaning the mobile operator is now fully locally owned.
The National Provident Fund is the country's main pension scheme and already had a stake in Vodafone.
The Fund now has a combined ownership of 79 percent in the mobile operator.
A South Pacific region analyst with Paul Budde Communications, says Vodafone has built up the
mobile phone market, achieving more than 100 percent penetration.
But Stephen McNamara told Bridget Tunnicliffe, there's still room for growth for 4G and mobile Broadband products.
STEPHEN MCNAMARA: There's more mobile phone numbers than there are people. In Fiji like many other places, subscribers often have two sim cards, so they have one for one network and one for an alternate network so they can call friends and family overseas. And with the market at 100 percent penetration the returns coming up in the future will probably decrease slightly so for Vodafone it's probably an opportune time to take stock of their investment and given that the elections are coming up it's a way to maybe invest in upcoming and emerging markets.
BRIDGET TUNNICLIFFE: So in some ways the market has reached its peak there.
SM: The mobile phone market has reached its peak, the mobile broadband market is continuing to see increases as more and more people use broadband. In Fiji the fixed line broadband market has decreased in the last couple of years as more people are using their mobile phones and they can use it wherever they are, be it home, work, or play. The mobile phone market has sort of reached its peak but there is still room for growth.
BT: On the Fiji National Provident Fund's part, do you think it's a good move to buy that 49 percent stake?
SM: The Fiji Provident Fund already has a stake in Vodafone through their holding in ATH [Amalgamated Telecom Holdings] so basically they're just increasing their holding of Vodafone, making Vodafone 100 percent locally Fiji owned and look that will get some good returns for the country as well as for the fund.
BT: The Provident Fund would be looking for a pretty safe investment, it's the country's main pension scheme, do you think this is a pretty solid investment?
SM: Telecoms have been a very solid investment in nearly every other country around the world including Fiji. With communications relying on the mobile network and the upcoming move towards 4G where people do a lot more things. Yes, this is a pretty good investment.
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