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4G delays: Huge license fees, bank wants new plan
19 Jan 2016 at 14:07 764 viewed0 comments
WRITER: JON FERNQUEST
ORIGINAL SOURCE/WRITER: KOMSAN TORTERMVASANA
Bids in the 900MHz 4G auction were 2 to 3 times higher than expected.
After bids in 900MHz 4G auction 2 to 3 times higher than expected, banks asking for new plans before license winners get cash.
MOBILE PHONES
4G delays: Huge license fees so banks want new plan
19/01/2016
Komsan Totermvasana & Somruedi Banchongduang
The winners of the 900-megahertz spectrum auctions are unlikely to make their first payments of bidding fees this month as initially expected due to strict bank lending conditions.
The delay in payments will postpone the planned commercial launch of fourth-generation (4G) wireless broadband service upcountry.
BANGKOK BANK INSISTS ON NEW PLAN FROM JASMINE
A source said Bangkok Bank was requiring Jasmine International, a 900MHz licence winner, to submit a new borrowing plan following the exorbitant licence cost the company paid.
The bank's demand has added uncertainty to Jasmine's future, as the loan is needed to ensure the company can smoothly enter the mobile service provider business.
"The request for a new borrowing plan came after Jasmine's winning bid was two or three times higher than forecast in its previous plan," a source said.
The two 4G auction winners last week told the NBTC they planned to pay the first half or 8.04 billion baht of the estimated real spectrum value.
Earlier, JAS Mobile Broadband, Jasmine's 4G arm, announced it would roll out 4G service on the 900MHz spectrum in mid-January and planned to have 15,000 base stations this year, accommodating 10 million 4G subscribers.
AIS GETS MORE TIME TO MIGRATE 2G CUSTOMERS
The delay gives Advanced Info Service (AIS) more time to migrate its existing 2G customers on the 900MHz network to other networks.
AIS faces a shutdown of its 900MHz network three days after the winning bidders make their first payments.
The auction rules, published last year in the Royal Gazette, stipulate the switch off date must be the day on which the winners of the 900MHz spectrum auctions receive their licences.
The NBTC acknowledges the winners informed us they needed more time to resolve some loan condition details with their lenders.
4G AUCTION LAST MONTH
The NBTC auctioned off two licences on the 900MHz spectrum last month, each containing 10MHz of bandwidth.
JAS Mobile Broadband won the first licence for 75.7 billion baht or 487% higher than the auction reserve price of 12.9 billion.
True Move H Universal Communication (TUC), a subsidiary of True Move, won the second licence for 76.3 billion baht or 491% above the reserve price.
Both JAS and TUC were given 90 days after the auction to make the first payment of 8.04 billion baht, for half the estimated spectrum value, which is required by March 21.
An additional 25% of the spectrum value is to be paid this year, with the final 25% in 2017. The winners must then pay their remaining bid amounts in 2018.
Whenever the winners make their first payment, they must also post three bank guarantees for the remaining amounts.
FIRST PAYMENT MAYBE IN FEBRUARY
Both JAS and TUC may make their first payments in the first week of February.
True Corporation said it has no problem applying for a syndicated loan with 10 potential bank creditors but admitted two lenders needed to adjust some loan conditions due to regulations on single lending limits, which is said to be just a technical problem, not a big deal, expected to be settled next week.
True Corporation says it does not need to hurry making a payment and rolling out 4G service on the 900MHz spectrum, as the company has time and True already provides 4G service.
TUC wants to provide the service at an auspicious time.