HO CHI MINH CITY -- Vietnam's military-run telecom company, Viettel Group, intends to invest $1.5 billion in a joint venture in Myanmar's burgeoning wireless market.
A Viettel representative said the company secured a license from Myanmar's government earlier this month. Now, it is in final negotiations with local partners Myanmar National Holding Public Limited, a special-purpose company, and state-owned Star High Public Company. The two Myanmar companies will own 51% of the joint enterprise.
The representative said the plan is to build a mobile network covering 95% of the population in the next three years. Initial services will use 3G, or third-generation, technology, with 4G services to start within a year. The source declined to disclose the total value of the project.
Myanmar is home to about 55 million people, some 60% of whom own smartphones.
Viettel Group, Vietnam's largest wireless network operator, failed to win a license in Myanmar in 2013 and 2014. But it is poised to become the second Vietnamese telecom company to step into the market, after FPT, which mainly focuses on Internet services.
Myanmar officially opened its wireless market to foreign investment in 2014. Since then, fees have dropped by more than half. Qatar's Ooredoo and Norway's Telenor were the first two foreign players to provide mobile services. Japanese carrier KDDI and trading house Sumitomo later teamed up with state-owned Myanma Posts & Telecommunications.
MPT controls the largest share of the market, with 18 million subscribers. Telenor and Ooredoo count 12 million and 5.8 million, respectively. The market is still developing and offers the most potential of any overseas market Viettel has explored, according to Le Dang Dung, the company's deputy general director.
Viettel does business in Cambodia, Laos, East Timor, Mozambique, Cameroon, Burundi, Tanzania, Haiti and Peru. It has about 85 million clients and generated $1.4 billion in revenue in 2015. It aims to expand to 20-25 countries and grow its international client base to 800 million in 2020, which would make it one of the world's top 10 telecom companies.
Brand Finance this year valued the Viettel brand at $973 million.