Mobile phone companies that lost out in the race for two mobile phone licences in Myanmar are being invited to pitch for a stake in what is one of the world's last major untapped markets – alongside state operator, Myanmar Post & Telecommunication (MPT).

Vodafone and Orange are part of a group of leading communications companies invited by the government to pitch to team up with MPT.

Foreign operators
Myanmar has invited the foreign operators to create a privately run partnership with MPT's telecoms arm, separate from the company's existing regulatory function, people familiar with the process say. Orange and Vodafone have been approached, along with other companies including Singapore's SingTel.

It was not clear last night whether Denis O'Brien's Digicel – another of the 20 consortiums that lost out on the licences, and one of 12 to be shortlisted in the competition – had been invited to pitch for the business.

Orange, Vodafone and SingTel took part in this year's tender for two licences that were awarded in June to Telenor of Norway and Qatar's Ooredoo, both of which may now face significant extra competition.

The plan offers Orange, which was runner-up in June’s licence awards, and a cash-rich Vodafone the chance of a tantalising second bite at a country where mobile usage is less than 10 per cent of the population. But it also involves the uncertainty of partnering a government company in a country in transition from five decades of military dictatorship.

“Obviously Orange is in a very good place after the original bidding round, and Vodafone is awash with cash,” says one Yangon-based analyst. “But this deal would require more complex due diligence than getting the new licences did.”

Vodafone and Orange declined to comment on the MPT joint venture plan. SingTel said only that it continued to explore opportunities in Myanmar. MPT did not respond to a request for comment.

– (Copyright The Financial Times Limited 2013)