The Bangladesh Submarine Cable Company Limited (BSCCL) has decided to sell the western section of its second submarine cable with a one time fee of Tk30.60 crore to the Saudi Telecom Company, widely known as STC.
The transfer will be implemented after the signing of a formal agreement between the two parties.
The state-owned company BSCCL is a core telecommunications service provider and international submarine cable operator of Bangladesh.
The BSCCL officials said the western part of the core cable of the SMW-5 submarine cable, known as second submarine cable, stretches from Yanbu in Saudi Arabia to Marseille in France.
The STC is a Saudi Arabia-based digital company that offers telecommunications services, landline, mobile, internet services, enterprise digital solutions, entertainment, fintech, and computer networks.
Md Anisul Islam, manager (share and legal) of the BSCCL, said if the connection is transferred to STC, the operation and maintenance cost of the BSCCL on the second submarine cable will be reduced proportionately in the coming days.
He said in our country people mostly use the internet for social media, playing games and to roam in video streaming sites. And all those sites have offices in Singapore. That is why Bangladesh is using the submarine cable of the Singapore area for the internet.
"If we use the submarine cable from the Western or European part, it will consume a higher amount of bandwidth. Bangladesh has to pay operational and maintenance costs for the western part of the cable every year," he added.
"That is why the agreement with STC is a good opportunity for the BSCCL to earn more revenue. If we need the western part of the second submarine cable then we will buy this from the STC at a cheap rate, because cable price decreases on a daily basis," he added.
The BSCCL was listed with the stock exchanges in 2012. Its share price rose by 10% to Tk180.40 each at the Dhaka Stock Exchange (DSE) in the last four days till Wednesday.
In the first quarter of the current fiscal year, its revenue rose by 43% to Tk77 crore riding on the increased consumption of broadband internet across the country. Its earnings per share also jumped by 93% to Tk2.01.
In the last fiscal year, the company has paid a 20% cash dividend to the shareholders and posted 63% growth in net profit at Tk95.60 crore despite the coronavirus pandemic.
Out of total shares of the company, the government holds 73.84%, institutional investors 11.58%, foreign investors 2.72% and the general investors 11.86%.