Asia Pacific Telecom Co’s (APT, 亞太電信) board yesterday approved a share sale plan intended to raise NT$14.4 billion (US$477 million) via a private placement, which has solicited strong interest from local fourth-generation (4G) license holders Hon Hai Group (鴻海集團) and Ting Hsin International Group (頂新國際集團).
The share sale triggered a new round of consolidation in the nation’s telecommunications industry, coming after Ting Hsin’s subsidiary Taiwan Star Cellular Corp (台灣之星) inked a deal to acquire local peer Vibo Telecom Inc (威寶電信) in November last year.
Asia Pacific Telecom said it plans to issue 826 million common shares at a preliminary price of NT$17.44 per share, according to a filing with the Taiwan Stock Exchange.
The company said it would use the proceeds to form strategic partnerships or finance equipment purchases.
The share sale would allow investors to own about 20 percent of the company. The Taiwan Railways Administration is currently the biggest shareholder of Asia Pacific Telecom, with a 12 percent stake.
Hon Hai’s telecommunications subsidiary Ambit Microsystems Corp (國碁電子) and Taiwan Star yesterday met with Asia Pacific Telecom to tender their offers, while Japan’s Softbank Corp also sent representatives to bid for a stake.
Asia Pacific Telecom did not make any decision yesterday, sources said.
Hon Hai chairman Terry Gou (郭台銘) told reporters that the results will be released by the end of this month.
Earlier this week, Ambit and Taiwan Star publicly expressed a “strong interest” in investing in Asia Pacific Telecom, eyeing the latter’s customer base and its new 10 megahertz (MHz) 4G bandwidth.
Ambit will not be able to fully launch its 4G services until 2018 due to a licensing issue. One of its 4G frequency bands is not expected to become available until July 2017, when the licenses used by the nation’s big three telecoms for the 700MHz spectrum are set to expire.
However, getting a stake in Asia Pacific Telecom would allow Ambit to enter the 4G market as early as the end of this year, it said.
For Taiwan Star, the investment would add 2.09 million new subscribers to its 1.72 million users via Vibo Telecom, which is set to become a Taiwan Star subsidiary later this year.
In addition, an APT buy-in would help Taiwan Star expand its 4G bandwidth to 30MHz, matching Taiwan Mobile Co (台灣大哥大) and Far EasTone Telecommunications Co (遠傳電信), while approaching Chunghwa Telecom Co’s (中華電信) 35MHz.
The big three telecoms plan to launch 4G services in July.
Asia Pacific Telecom yesterday posted 20.27 percent annual decline in revenue for last month at NT$1.4 billion, with cumulative sales for the first fourth months down nearly 23 percent to NT$5.57 billion.
Asia Pacific Telecom shares plunged 4.19 percent to NT$17.15 yesterday, snapping a five-day winning streak.
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