Thai mobile start-up Jas Mobile Broadband (Jas4G), a subsidiary of Jasmine International, has indicated that it is struggling to secure funding to pay for the USD2.1 billion 900MHz licence it won at auction in December, confirming persistent rumours ahead of a deadline of 21 March when it must produce the first instalment alongside bank guarantees for the remainder. The Bangkok Post reports that Jas Mobile is now sounding out authorities’ reactions about ‘making the payment in instalments’ rather than a lump sum as stipulated in auction rules. ‘The move reinforces the widespread expectation that the company has run into difficulties meeting its financial obligations,’ a source close to Jasmine’s executives was quoted as saying. Meanwhile, the secretary-general of the National Broadcasting and Telecommunications Commission (NBTC), Takorn Tantasith, has continued to insist that ‘the full payment must be made by March 21.’ A physical payment of THB8.04 billion (USD225 million) is due by 21 March alongside three bank guarantees for the remaining instalments to be collected in 2017, 2018 and 2019.
The other winner of 900MHz spectrum at the auction, True Corp, has now confirmed that it will hand over the full instalment/bank guarantees this month in compliance with the rules, following the arrangement of a new syndicated loan. A True source was quoted as saying: ‘We won’t follow Jas’s lead even though this puts us in the unfair position of being the sole payer of the full amount.’
The Post also quotes an unnamed source ‘close to’ Jasmine CEO Pete Bodharamik as saying that the executive now favours abandoning the mobile start-up project and simply allowing the NBTC to take Jas Mobile’s THB645 million auction guarantee, but adds that the CEO’s father, former commerce minister Adisai Bodharamik, wants his son to continue fighting to secure the massive funding. The same source said that Jas Mobile’s three prospective foreign partners – Temasek Holdings of Singapore, SK Telecom of South Korea and Chunghwa Telecom of Taiwan – have all suspended partnership talks pending a clear resolution on payment terms. A Bangkok Bank source said Jasmine’s borrowing plan had been rejected for a second time, as the bank was not confident in the start-up’s ability to acquire new mobile subscribers while competing with the three major operators AIS, DTAC and True Corp. ‘We have no doubts about Jas’s ability to make revenue per user per month … Our concerns are the company’s ability to acquire customers,’ the source said.
Jasmine also faces the potential prospect of its existing licences, including fixed broadband (Triple T Broadband) and digital TV, being revoked if it fails to pay for the mobile concession.