July 22, 2018, 11:44 pm
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Group eyes foreign partner in telco bid

Filipino-owned Transpacific Broadband Group International Inc. (TBGI) is eyeing to sell up to 40 percent of its stake to foreign investors to raise funds as it joins this year’s bidding for the country’s third major telecom player.

In a disclosure to the stock exchange, TBGI said its board has approved the resolution that authorizes the company to raise funds equivalent to 40 percent of stockholders’ equity to foreign investors. 

Led by Arsenio Ng as chairman, TBGI offers telecom services in  Clark Special Economic Zone such as  public commercial radio, terrestrial, cable and satellite broadcast.

TGBI also provides VSAT (Very Small Aperture Terminal) based internet services, wireless networking, educational programs, applications hosting, content conversion and video uplink services to local and foreign television channels.

TBGI said it will use the funds to be able to participate in various opportunities in thetelecommunications market brought about by the government’s directive to have a third telco in the Philippines.

These include participating in a consortium of third telco investors, taking part in a consortium of “Common Tower Investment Corp.” to establish 50,000 tower sites nationwide, and establishing a representative office in China with coordination and cooperation with a China consortium involved with telecoms and technology, the aim of which is to bring in Artificial Intelligence initiative, Block Chain technology, asset-backed Initial Coin Offering and Internet-of-Things technology.

“TBGI can participate in any or all segments,” the company said.

Aside from equity from foreign investors, TBGI co-invested with ATN Holdings Inc. for 30 percent ownership in ATN Solar that established the most modern crusher plant, a high margin business that can generate significant cash dividends to be used by the company in the telecom opportunities.

“The co-investment in an aggregate raw material supply ecosystem is a relevant leveraging strategy in sourcing large-scale equity funds for the telco business opportunities,” TBGI said.

TGBI is expected to be a strong contender in the search for the third telecom player.  

“Completing the 40 percent participation of foreign investor, ATN Holdings, Inc. can co-invest business opportunities given its huge rock inventory,” TBGI said.

The company is qualified to take part in business opportunities in the telecom market since it has a 25-year congressional franchise.

TBGI is among the 15 local telecom firms eyeing to join the bidding for the new major telecom player by the third quarter.

TBGI reported  P8.6 million revenues in January to March this year, slightly lower compared in revenues in same period last year of P8.8 million. The company reported a net loss of P328,987 in first quarter this year, lower compared to P598,780 net loss in the same period last year.

The Department of Information and Communications Technology is expected to release next month the final version of the terms of reference for the selection of the new major telecom player.

Local telcos prefer the highest committed level of services (HCLoS) as mode of selection for the new player rather than an auction, which requires companies to place a minimum bid price of P6.28 billion.

Using the HCLoS, the winning bidder will be selected based on national population coverage, minimum average broadband speed, and annual capital and operational expenditure, computed annually over a five-year period.

The annual minimum levels for each of the criteria are 30 percent for the national population coverage, 5 megabits per seconds for the minimum average broadband speed and P40 billion for the capital and operational expenditure.

Other qualifications include a congressional franchise, paid capital of at least P10billion and for technical capability, one of the consortium membersmust have experience in the provisioning, delivery and operations of telecom services for the last five years.

At stake is a certificate of public convenience and necessityto be issued by the National Telecommunications Commission with a term of 15 years or until the expiry of the new major telecom player’s congressional franchise, and several frequency assignment enough to allow it to offer 2G, 3G and 4G services – almost equal the frequencies assigned to the two incumbent players.
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