Telecom Malagasy

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Telecom Malagasy (Telma) was the state owned, incumbent fixed-line and long distance telecommunications operator in Madagascar. The government agreed to sell a 34% stake in Telma to Hong Kong-based Distacom for US$12.6 million in August 2003 through competitive bidding. Distacom out bid France Telecom when it won the share in Telma in December of 2001, but political instability in Madagascar delayed the divestiture process and the sale was not finalized until June of 2004. As part of the deal, France Cable et Radio, a subsidiary of France Telecom which owned 34% of Telma, also sold its share to Distacom for about US$12 million. The remaining 32% of Telma remained in the hands of the government, of which 10% was to be assigned to the employees of the company. Telma had approximately 58,000-fixed line subscribers from a population of 15 million as of 2004. It had planned to increase its fixed-line telephony subscribers to 160,000 over the following four years. As a part of the divesiture scheme, Telma was granted a two year exclusivity period before a second national operator could be allowed into the market. Also under the agreement, Distacom was committed to covering the 112 regions of Madagascar with fixed-line telephony by 2006. Distacom was also the principal shareholder in Madacom, one of the island's three cellular phone operators with a total of 200,000 subscribers at the time of the sale. However, in 2005 Distacom sold 66% of it shareholding in Madacom to Celtel of the Netherlands. http://www.telma.mg