San Diego-headquartered VelaTel Global Communications has announced that it has signed an agreement with Cyprus-based holding company Kerseyco Trading to acquire a 51% controlling interest in Kerseyco and its Serbian subsidiary, internet service provider (ISP) VeratNet. In exchange for the stake VelaTel will upgrade VeratNet’s wireless broadband infrastructure, doubling the subscriber capacity of the network. The development will utilise equipment provided by Chinese vendor ZTE under its existing strategic agreement with VelaTel. In addition, the US-based company will contribute the funds required to continue the Serbian ISP’s current operations. The deal is expected to be finalised by February 2012, with the network improvements due to be completed by the summer.
The agreement with Kerseyco includes the option for VelatTel to up its stake to 75% in exchange for expanding the network, increasing the number of base transceiver stations (BTS) from eleven to more than 50. In a company press release, VelaTel commented it would go through with the expansion should VeratNet see subscriber growth or if the ISP is awarded licences covering additional geographic regions in Serbia. At present, VeratNet’s concessions allow it to deliver wireless broadband in three cities, including Belgrade, where it holds radio frequency licences.
The acquisition is in line with VelaTel’s strategic goal of expanding its footprint in eastern Europe, Latin America, the Caribbean and southeast Asia and follows a similar deal signed with Herlong Investments earlier this month which will lead to VelaTel taking 75% of Herlong and its Montenegrin and Croatian subsidiaries.