Mobile Capital

April 20, 2007 (LBO) – Dialog Telekom, a unit of Malaysia Telekom, is raising 20.5 billion rupees from the capital market through an issue of ordinary and preference shares, the firm told the Colombo Stock Exchange Friday. (1 US dollar = Rs 110) The mobile operator, Sri Lanka's largest is raising 15.54 billion rupees by offering one ordinary share at 21 rupees for every ten existing shares.

A further 5 billion rupees would come from 5 billion redeemable preference shares of one rupee each.

Chief Executive Hans Wijayasuriya said the preference shares would be privately placed among 'selected investors including banks and financial institutions having substantial investment potential'.

Receiving preference dividends from firms with tax concessions is attractive from a tax perspective to lenders if they are prepared to put up with the 'uncertainty' of a preference dividend.

"The proceeds of the rights issue and preference share issue will partially finance Dialog Group’s capital expenditure plan for the next three years in view of envisioned transformational investments in convergent technologies and related businesses," Wijayasuriya said in the statement.

Dialog has already expanded into pay tv an