CAT: True must resolve asset issue
TRUE CORP'S plan to establish an infrastructure fund is likely to hit a snag, as CAT Telecom will inform the Securities and Exchange Commission (SEC) that CAT and True still have issues to clear up related to the network assets the company will sell to t
CAT senior executive vice president Hansa Chevapurke said the state telecom agency had also asked True to talk with CAT on this matter before forging ahead with its infrastructure fund.
“We don’t mean to block its plan but [the network assets] that belong to us have to belong to us, and must not be included in the fund. Therefore, both of us have to make it clear first which assets belong to True and which belong to us under the concession,” he said.
He added that CAT would again approach an arbitration panel on its dispute with TrueMove, a True subsidiary, on the unclear ownership of 4,500 telecommunications towers out of 7,000 used by TrueMove under CAT concession, once TrueMove’s concession expires on September 15.
Earlier both had submitted the case for arbitration. The panel recently dismissed the case, saying the parties should wait until TrueMove’s concession ends. Under the concessions granted by state enterprises, private holders are required to transfer their network assets to the state enterprises after their concessions end.
Hansa said CAT planned to bring the remaining 2,500 towers before the arbitration panel as well as the original 4,500.
Recently True Corp chief financial officer Noppadol Dej-Udom said the corporation had decided to exclude these 7,000 TrueMove tower assets from its planned infrastructure fund to ensure that the fund can be launched this year. He added that this exclusion would not affect the company’s plan to set up the fund.
CAT will also tell the SEC it will clear with True which part of the core fibre optic cable network True Group would sell to the fund as some of the networks on 100 routes belonged to the state agency.
The state agency will also tell the SEC that though True plans to sell the telecom towers of True’s subsidiary, BFKT (Thailand), to the fund, CAT still has the right to lease or buy these towers. It is entitled to this right as stated in the network rental contract between CAT and True Corp.
A key part of the infrastructure fund’s creation is True’s plans to sell the telecom infrastructure assets of its group’s businesses to the fund, including telecom towers, core fibre optic cable networks, and the right to revenue from equipment rental to the fund. It will also acquire a 33-per-cent stake in the fund.
