NT's plan moving in low gear
KATHMANDU:
It has been more than five years since Nepal Telecom (NT) has been pushing for an international strategic partnership to boost its presence in the market. However, the snail-paced progress indicates that it will be two more years before it is able to rope in a partner.
Even as NT issued request for proposals (RfPs) from shortlisted potential international consultants in June this year, it is yet to complete the evaluation and negotiation, and reach an agreement. The consultant to be hired will prepare due diligence audit (DDA) report of NT, bid documents and conditions of contract to be signed with the strategic partner.
NT officials said that evaluation of technical proposals of potential consultants is taking time as they had to study multiple factors, including work experience, human resource and working methodology of the applicants before opening financial proposals.
Madhu Sudan Karmacharya, spokesperson for NT, said that an evaluation team is set to complete its study of the technical proposals within 10 days and open financial proposals.
“We are hopeful of signing a contract with a consultant scoring highest marks by mid-December after negotiations,” he added. The company had called expression of interest (EoI) in March this year. Selection of a consultant is the first phase in the process of finding a strategic partner for NT.
All six shortlisted international firms — Ernst and Young LLP (India), Deloitte Touche Tohmatsu India (India), KPMG Advisory Services (India), Analysys Mason India (India), Detecon International GmbH (Germany) and Roland Berger Strategy Consultants of Singapore — have submitted their technical and financial proposals. As per NT criteria, DDA will be carried out by the consultant itself or it can also hire a globally experienced consulting firm.
In 2012, a study on NT’s strategic partnership plan conducted by the Ministry of Finance (MoF) had concluded that if the process were sped up, a partner could be brought in within two years. The study had also included a work plan for effective execution of the whole plan. And in October last year, the Cabinet had permitted NT to bring in a partner by divesting certain per cent of share owned in the company by the government.
It will take six to nine months for preparation of DDA, bid documents and getting the tender documents approved, after the selection of a consultant. In the second phase, based on the tender documents and the DDA, EoI will be issued to look for potential strategic partners.
Inviting EoI and evaluation, shortlisting of international companies, issuance of RfP, evaluation of financial and technical proposals, negotiation with a selected partner and agreement signing will take around a year’s time, if execution is intensified, according to the MoF study.
The partnership is targeted at boosting the performance of NT by making it more competitive, helping to introduce newer technologies and providing better services to customers.
An official at NT said that delay in bringing in a partner, internal management problems, rigid procurement laws and increased competition in market have been affecting the company. The government currently holds 92 per cent share ownership in NT. It plans to sell 30 per cent of its stake, for which the partner will have to invest a minimum of Rs 30 billion.
Source: THT
