The government has begun work to increase its ownership in Dhiraagu to 51 percent and acquire the remaining foreign-held shares in Malé Water and Sewerage Company (MWSC), President Dr Mohamed Muizzu announced on Monday.
Speaking at a press conference at the President’s Office, Muizzu said the decisions were reached following Cabinet discussions and that administrative, legal and financial work required for both transactions is now underway.
Under the plan, the government intends to restore its stake in Dhiraagu to a controlling 51 percent, reversing the reduction in state ownership that took place during the first Maldivian Democratic Party (MDP) administration.
“Government majority ownership in Dhiraagu was sold off during the first MDP administration, divesting a major national asset,” Muizzu said.
The President argued that regaining majority control of the country’s largest telecommunications provider would serve the public interest and contribute to economic and national development.
“We believe that restoring state ownership in Dhiraagu to 51 percent is essential for public welfare, economic expansion, and national growth,” he said.
Dhiraagu is currently majority-owned by BTC Islands Limited, part of Bahrain-based Beyon, which holds 52 percent of the company. The Government of Maldives owns 41.8 percent, while the remaining 6.2 percent is held by public shareholders.
This means the state would need to acquire an additional 9.2 percentage points to reach the 51 percent ownership target announced by Muizzu.
The President said the government intends to proceed with the acquisition at a fast pace, although he did not disclose the estimated cost, the source from which the additional shares would be acquired or a timeframe for completing the transaction.
“This process will encompass administrative, legal, and financial arrangements, covering all necessary aspects,” he said.
Government stake in Dhiraagu reduced under Nasheed administration
Dhiraagu was established in 1988 and initially operated as the country’s sole telecommunications provider. Its ownership structure underwent a major change during former President Mohamed Nasheed’s administration when part of the government’s shareholding was offered to the Maldivian public.
In October 2011, the government launched an initial public offering for 11.4 million Dhiraagu shares, priced at MVR 80 each, as part of the state’s shareholding in the company.
The company was subsequently listed on the Maldives Stock Exchange in 2012. Dhiraagu currently has 76 million registered shares and a share capital of MVR 190 million.
Batelco became Dhiraagu’s majority shareholder in 2013 after acquiring the Monaco and Islands assets of Cable & Wireless Communications, which previously held the 52 percent foreign stake.
MWSC to become fully state-owned
Muizzu also announced that the administration is moving to acquire the 20 percent foreign-held stake in MWSC, which would make the utility company 100 percent government-owned.
The President said those shares had also been sold to a foreign company during an MDP administration and that reclaiming them would strengthen MWSC and its ability to provide essential services.
“This is another vital initiative for the public, necessary to further strengthen MWSC’s service delivery,” Muizzu said.
Work to acquire the 20 percent stake has already begun, according to the President.
MWSC provides water and sewerage services in the capital and operates water and sewerage infrastructure in several other parts of the country, making the company a key provider of essential public utility services.
Muizzu framed both acquisitions as part of his administration’s policy of increasing state control over strategically important national assets.
However, details of the proposed transactions, including their total financial cost, how the acquisitions will be funded and negotiations with the existing shareholders, have yet to be publicly announced.
“God willing, both of these initiatives will be carried out smoothly and completed successfully,” the President said.
If completed as planned, the transactions would return the government to majority ownership of Dhiraagu with a 51 percent stake while bringing MWSC entirely under state ownership.
