Vibo puts VMAX stake up for grabs; Far EasTone and Japan’s UQ linked with bids

23 Jun 2011

According to the Taipei Times, Taiwanese mobile operator Vibo Telecom is in talks with two potential buyers to sell its 34% stake in WiMAX operator VMAX Telecom. Other shareholders in VMAX include local equipment maker Tecom (48%) and US-based chip manufacturer Intel (18%), and Vibo’s announcement coincides with reports that Intel is seeking to exit the Taiwanese WiMAX sector after significantly downsizing its local presence. Vibo intends to use any capital generated by the sale to ramp up the deployment of its 3G network. Vibo CEO George Chou told reporters: ‘We are determined to sell [the VMAX stake] … To [better utilise] limited resources, we have to concentrate on our core business. Our 3G coverage is not sufficient yet’. Chou has previously indicated that the firm hopes to embark on a TWD3 billion (USD104 million) upgrade of its 3G base stations by end-2011.

Citing reports by the Chinese-language Economic Daily News, the Taipei Times indicates that Taiwanese cellco Far EasTone and UQ Communications, Japan’s largest WiMAX operator in terms of subscribers, have both expressed an interest in acquiring Vibo’s unwanted stake in VMAX. Any potential deal would allow Far EasTone to expand its WiMAX coverage to the northern part of the country; in July 2007 the operator was awarded one of the three available 2.5GHz WiMAX licences covering southern Taiwan. The company initially deployed a number of small trial WiMAX projects as part of the government’s M-Taiwan strategy to increase broadband internet penetration in rural areas, and now offers WiMAX connectivity in Taichung City, Kaohsiung City and Penghu Island.

According to TeleGeography’s GlobalComms Database, VMAX was one of three firms awarded a 2.5GHz concession for northern Taiwan in July 2007. In October 2009 VMAX completed the first phase rollout and two months later it was awarded its operating licence by the NCC. The company went on to launch commercial operations in January 2010, offering coverage of 85% of the population of Taipei City. VMAX now offers coverage of Taipei County/City, Keelung City, Taoyuan County, Hsinchu County/City, Miaoli County, Yilan County and Matsu.