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TUC to invest Bt57 bn over 3 years, aiming to rule mobile telecom roost

Mar 01. 2016
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TRUE MOVE H Universal Communication (TUC) aims to become the top dog in mobile-phone coverage on all frequencies by investing Bt57 billion over three years.

“We expect to see revenue from our mobile-phone services grow more than 17.3 per cent this year.

“We are also aiming to secure a market share of at least 30 per cent, up from the current 21 per cent, within three years,” Suphachai Chearavanont, chief executive officer of True Group, said yesterday.

The capital expenditure budget will be financed by a capital increase from major shareholders, supplier credit, loans and cash.

This year will see the company investing Bt40 billion, of which Bt36 billion will go to installing 20,000 base stations for the 900-megahertz network and Bt4 billion to add 3,000 base stations to its current 22,000 base stations for the 1,800MHz and 2.1-gigahertz networks to cover 98 per cent of the population.

Its third-generation network on 850MHz will run on 16,000 base stations.

True will also seek new users shifting from Advanced Info Service’s the 2G service after launching 2G and 4G services on 900MHz this month.

“We plan to pay the first instalment [of its upfront fee for the 900MHz licence] and place bank guarantees in two weeks,” he said after TUC signed letters of guarantee with six banks for Bt73.04 billion.

The guarantors are Industrial and Commercial Bank of China (Thai) with half of the total, Bangkok Bank, Kasikornbank and Siam Commercial Bank with Bt10.5 billion each, Krungthai Bank with Bt4 billion and Kiatnakin Bank with Bt3 billion.

The five Thai banks insisted that they had no problems with the Bank of Thailand’s single lending limit and could continue to support True in the future.

Arthid Nanthawithaya, chief executive officer of Siam Commercial Bank, said ICBC (Thai) offered to provide 50 per cent of the total guarantee. The Thai banks agreed with the proposal because then they could have more room to assist True if the customer required additional support from financial institutions.

ICBC (Thai) asked the BOT if ICBC Hong Kong could open a standby letter of credit for ICBC (Thai) to support the letter of guarantee to True. Under Thai broadcasting regulations, a letter of guarantee must be issued by a local bank.

Zhigang Li, chairman of ICBC (Thai), said the bank was a believer in the Thai economy and Thailand was a top travel destination for Chinese tourists. The bank is confident that True will become the leader in 3G and 4G in Thailand and the bank will have further cooperation with True Corp in developing telecommunications in Thailand.

The other winner of a 900MHz licence at an auction late last year, Jas Mobile Broadband, is facing difficulties in submitting its letter of guarantee by March 21 because the company has not submitted a new business plan yet.

Chansak Fuangfu, senior executive vice president of Bangkok Bank, said the bank had been contacted by Jas Mobile Broadband but had not made any decision on what to do.

It has to consider three points – Jas’s business plan, the position of the regulator, and other conditions such as collateral.

Another customer, CTH, which failed to secure the broadcasting rights for the English Premier League, continues to pay its debts as usual. However, the situation has changed, so the business plan of CTH should be adjusted, he said.

CTH is expected to talk with the bank soon.

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