SingTel has also granted a call option to increase its equity interest to 60 percent for an additional $65 million.

Officials of both companies signed the deal for 45 percent in Singapore, while that for 15 percent will take place later, a source linked to the deal told The Daily Star from Singapore.

Faisal Morshed Khan, representative of the Pacific Group and Vice Chairman of PBTL, and Chris Maloy, chief executive officer (CEO) of PBTL are now in Singapore in connection with the deal.

Sources pointed out that concentration of more giant telecommunications companies in Bangladesh would lead to more competition in the sector, resulting in reduced call tariffs.

SingTel Asia Pacific Investments Pte Ltd (STAPI), a wholly-owned subsidiary of Singapore Telecom Mobile Pte Ltd, has invested $118 million for a 45 percent equity stake in PBTL, SingTel said in a statement.

Of this investment, $90 million will be for a subscription of new shares, it added.

The investment comprises both new and existing shares of PBTL. The blended pre-investment equity valuation of PBTL is $206 million.

As of December 31 last year, the audited net book value of PBTL's shares acquired was about $15 million.

PBTL, a member of the Pacific Group, operates a nation-wide CDMA (code-division multiple access) network in Bangladesh.

"SingTel believes that there will be rapid telecommunications growth in Bangladesh for years to come, as has been experienced in other regional markets which SingTel has invested in," Lee Hsien Yang, SingTel's President and CEO said.

Faisal Morshed Khan said, "We are proud to welcome SingTel, the leading communications group in Asia, as our strategic investor."

Earlier, Egyptian telecom giant Orascom Telecom (OT) in September last year bought Sheba Telecom for $50 million in cash and about $10 million in debts it has repaid.