ADN Telecom to acquire 40% more stake at ADN Int'l Gateway

ADN Telecom plans to acquire an additional 40% stake in ADN International Gateway, a non-listed firm operating under common management, at a cost of Tk1.13 crore.

Currently, the IT and telecommunication services provider holds a 40% stake in ADN International Gateway, one of the major sister concerns of ADN Group, a leading global data communications service provider, including integrated communications solutions for enterprise and wholesale businesses.

ADN Gateway serves as a gateway for routing international incoming and outgoing Internet and intranet-based traffic.

After the fresh acquisition, ADN International Gateway will be a subsidiary of ADN Telecom.

In a stock exchange disclosure on Tuesday, ADN Telecom hoped that the acquisition would lead to further success and growth for both companies, strengthening their overall position in the market.

In the July-September quarter, ADN Telecom reported a 10% year-on-year drop in revenue and a 32% slump in profit to Tk29.88 crore and Tk4.44 crore, respectively.

In an explanation, the company said that its revenue declined mainly because of the discontinuation of internet services to the Bangladesh Police. However, the company believes the decline in revenue is temporary in nature.

"But as the cost of services did not reduce, which affected the profit for the quarter, profit is expected to revive again as soon as lost business is covered by the business growth in the pipeline," the disclosure reads.

Md Monir Hossain, company secretary of ADN Telecom, told The Business Standard, "We used to provide internet services to the Bangladesh Police. But owing to the ending of the agreement, the police have discontinued the deal as they selected another entity to provide services through tender."

"As a result, revenue declined and profit fell," he added.