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Summary of Project Information (SPI) |
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| Project number | 9901 |
| Project name | Suntel |
| Country | Sri Lanka |
| Sector | Information |
| Department | Global Inform. & Comm. Tech. |
| Company name | Suntel Limited |
| Environmental category | B |
| Date disclosed | November 30, 1999 |
| Status | Active |
| Previous Events | Invested: November 22, 2000
Signed: September 25, 2000
Approved: June 20, 2000 |
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The primary sponsor of Suntel is Telia of Sweden (55%). The other shareholders include the Metropolitan Group of Sri Lanka (21%), controlled by the Ambani family in Sri Lanka; TVG Asian Communication Fund (19%), a Hong Kong-based private equity fund; and National Development Bank (5%), a leading Sri Lankan financial institution. Telia, with over 6 million subscribers worldwide, had a net income of $288 million on sales of $3.6 billion in 1998.
- Project Cost Including proposed IFC investment
The project consists of the expansion of Suntel's nationwide Wireless Local Loop (WLL) network. WLL is a system employing a radio-based technology platform to provide the final (last mile) access to the user. It is beneficial in terms of scalability, allowing it to be deployed in small increments to closely match subscriber demand, thus reducing unnecessary capital expenditure. Total project cost is estimated to be $110 million. IFC's proposed investment would be up to $30 million, which would likely consist of: up to $22.5 million in IFC guarantees of local currency bond and bank debt, and up to $7.5 million in IFC equity or quasi-equity.
- Location of project and Description of site
Suntel has a license for a nation-wide Wireless Local Loop telecommunications network to provide fixed basic telephony and data transmission services. At present, it covers 9 out of the 28 administrative areas it committed to serve under the license.
- Description of Company and Purpose of Project
The project consists of the expansion of Suntel's network. Suntel offers basic telephony using Wireless Local Loop technology. It commenced operations in 1996, and has grown to a total subscriber base of about 50,000, representing 9% of the fixed telephony market.
IFC's guarantee of local bond and bank financing will enable the mobilization of a significant amount of funds, which would otherwise not be possible; it will encourage investments from non-banking institutional investors who would be unlikely to lend to an infrastructure development project without IFC's guarantee; and it will increase the breadth of the debt securities market in Sri Lanka. IFC's involvement will help fulfill the company's desire for local currency funds, minimizing foreign exchange risk. The project supports the liberalization and development of a competitive telecommunications sector, providing low-cost access to basic as well as value-added telecommunication services with a customer focus.
- Environmental Category and Issues
This is an environmental and social review category B project. Issues reviewed include:
- environmental and social performance of Suntel’s operations, including right of way alignment;
- land acquisition;
- access road construction;
- development of previously undisturbed land;
- tower site and base station selection and construction;
- compliance of future projects with local requirements and World Bank policies and guidelines;
- PCBs and Halons;
- solid and liquid waste treatment and disposal;
- fire prevention and emergency response; and
- worker safety including exposure to excessive noise.
Suntel’s land acquisition staff selects equipment sites based on technical suitability and market price of land in the area. Land acquisition is on a willing buyer and willing seller basis. Rooftop tower sites are negotiated with building owners, and required approvals are obtained from government and local authorities for the construction. Suntel has so far not built access roads, and no site has been selected or constructed in an area that is environmentally sensitive. New sites are selected according to procedures laid down by the government regulations.
All equipment used in Suntel’s network is new, and no chlorofluorocarbons (CFCs including Halon) will be installed. Only minor amounts of solid and liquid wastes are produced. Generators used for back-up power supply are equipped with sound attenuation enclosures, as required, and fuel storage tanks are equipped with secondary containment. Suntel’s sites are equipped with fire extinguishers and other emergency equipment. The company provides employee training on environmental, health and safety issues. All employees are provided with personal protective equipment as appropriate to their jobs.
The is from the InfoShop.
| Host country location of environmental documents | 1. Telecommunications Regulatory Commission of Sri Lanka
No. 276, Elvitigala Mawatha
Colombo 8
Sri Lanka
2. The Environmental Authority
Maligawatte New Town
Colombo 10
Sri Lanka |
Date SPI sent to InfoShop November 30, 1999
“This Summary of Project Information is prepared and distributed to the public in advance of consideration of the proposed transaction by the Corporation’s Board of Directors. It is provided for the purpose of enhancing the transparency of IFC’s activities and should not be construed as presuming the outcome of IFC Board consideration.”
For Additional Information contact:
Corporate Relations Unit
Telephone: (202) 473-7711
Fax: (202) 974-4384 |
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| Environmental documents for this project are available at http://www.ifc.org/projects and from the World Bank InfoShop (http://www.worldbank.org/html/pic/aboutinfo.html). |
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