True appoints bank to support 3G development, as licensing terms finalised

26 Aug 2010

Thailand’s True Corp, parent of cellco True Move, yesterday appointed Siam Commercial Bank (SCB) as its financial adviser and lead arranger to support its planned development of 3G services as it prepares to bid in next month’s 2100MHz UMTS licence auction. Thai newspaper The Nation reports that SCB will work with other financial institutions as part of the deal to strengthen True’s financial position. TeleGeography says that True has earmarked THB25 billion-THB30 billion (USD772million-USD926 million) for 3G network development over two years, excluding the THB12.8 billion minimum concession price set by the National Telecommunications Commission (NTC). The domestically-owned group has said it will seek a strategic partner to take a stake in True subsidiary Real Move, formerly known as S&K Wireless, via which it is bidding for a 2100MHz licence, to help fund 3G development.

The NTC reported yesterday that 18 companies have so far bought bidding documents for the 3G auction set to be held 20-28 September, whilst all potential bidders have until 30 August to submit bid proposals. The regulator has now finalised its 3G licensing terms, but even this close to the bid proposal date the details still have to be approved by the regulator’s board of directors. NTC commissioner Natee Sukonrat said on Tuesday after the last public hearing on 3G regulations that the final draft would be submitted for the board’s approval in the next two weeks. Licence winners must achieve ‘national’ coverage within five years, whilst a 30MHz spectrum cap on operators will be imposed following the auction, with companies to be given a year to surrender or sell excess spectrum; Natee added that state-run fixed, mobile and broadband operator TOT, which holds 64MHz of spectrum, would be urged to auction off surplus frequencies.

The commissioner also told the press that 3G licence winners considered to be violating the country’s foreign ownership regulations will be given leeway to ensure they comply with local laws within a timeframe to be agreed with the regulator. The NTC’s draft licensing regulations stress that foreign entities’ direct and indirect holdings must not exceed 49% in local telecom companies. TeleGeography’s GlobalComms Database says that foreign investors including Singapore’s Temasek (in cellular market leader AIS) and Norway’s Telenor (in second-placed cellco DTAC) have been able to get round the foreign ownership limit of 49% by holding majority shares through local nominee companies, whilst in April 2007 the Cabinet approved amendments to the Foreign Business Act that exempted businesses in the telecoms sector from a legislative clampdown on nominee shareholdings, allowing cellcos to continue with foreigners holding majority voting rights via a combination of direct and indirect shares.

Thailand, True Move