Palestine Telecommunications Company (Paltel) is investing $75m this year to expand its network in the West Bank and Gaza Strip after Israeli authorities lifted restrictions on importing equipment into the area.
“To date we have invested more than $700m in our networks, and we are looking to invest around $60-70m every year,” says Ammar Aker, chief executive officer of Paltel.
The company, one of two mobile operators in Palestine, has been lobbying with the Israeli authorities to grant them third-generation (3G) frequencies, which may happen in 2013.
“If we get the chance to deploy 3G, then we’ll set aside $100m for this. We are ready to invest and provide Palestinians with mobile broadband. We are trying very hard to pressure the Israeli side to grant the spectrum,” says Aker.
The funding will come from retail earnings and financing from within the company.
According to Aker, Paltel still has a lot of room to grow in terms of broadband and mobile. Penetration levels in Palestine are still low. In the West Bank, mobile penetration is about 80 per cent and in the Gaza strip it is below 60 per cent.
In 2009, Paltel had intended to merge with Kuwait’s Zain, but the plan fell through.
“Zain was going through a lot of changes at the time and we were not a priority. Currently we are not subject to an acquisition or merger, but if the right opportunity approaches us, any major regional or international operator, then we will consider looking into possible merger opportunities,” says Aker.
Paltel recorded a net income of $67m for the first half of this year, up 16.6 per cent since the same period in 2010. Revenues reached $257m, a growth of 11 per cent. The number of mobile subscribers grew 11.75 per cent to 2.31 million.
It is the largest listed company on the Palestine Exchange and a market capitalisation of $1bn.