Asia Pacific board approves merger

Local fixed-line company Asia Pacific Broadband Telecom Co (APBT, 亞太固網) yesterday said its board had approved a merger with its mobile affiliate in a bid to fend off creditor bank Deutsche Bank's intention to auction off its mobile business to recover outstanding debts.

The board meeting had initially been scheduled for tomorrow.

appeal

APBT was also looking into the possibility of filing an early appeal against a district court ruling that gave the German lender the right to sell the assets of its mobile affiliate Asia Pacific Broadband Wireless Communications Inc (APBW, 亞太行動寬頻).

"We are still discussing with our lawyers and we hope to file an appeal within the week," APBW spokeswoman Lee E-hua (李宜樺) told the Taipei Times during a telephone interview.

Deutsche Bank could sell APBW assets to US private equity investor Carlyle Group, the Chinese-language Commercial Times reported yesterday, without citing a source.

Last year, Carlyle bought a controlling stake in Taiwan's biggest cable TV operator Eastern Multimedia Co (東森媒體科技) and its 12 affiliates for NT$47.6 billion (US$1.43 bilion).

countersuit

As part of its efforts to safeguard APBW, the fixed-line company also planned to file a countersuit in response to Deutsche Bank's lawsuits filed in Taiwan and the UK earlier this month.

In its complaint, the lender said the telecom companies had breached a credit agreement signed last year.

Last year, under its former chairman Wang You-theng (王又曾), APBT obtained a NT$6.8 billion bank loan from Deutsche Bank, using its 1.42 billion shares, base stations and telecom equipment as guarantees.

But early this year, the telecom company stopped paying loan interests after the board, led by new chairman Springfield Lai (賴春田), found that most of the terms of the agreement, such as interest rates higher than the market average, were unreasonable.

convergence

Having made increasing operational efficiency a priority, the fixed-line operator said it planned to merge the fixed-line and mobile businesses amid the growing trend of fixed-mobile convergence, a statement said.

The consolidation of its communications branches would greatly increase operating profits, the company said in the statement.

Consolidated revenues would grow 10 percent to more than NT$20 billion in 2009 and costs would be reduced by 5 percent annually.

APBT has yet to release its financial report for last year.

To increase its competitiveness, APBT said it would also absorb Internet service provider Asia Pacific Online Services Inc (亞太線上), which is 73 percent owned by the fixed-line telephone company.