True Corporation is determined to move ahead with a planned 70-billion-baht infrastructure fund despite an unsettled dispute with its concession owner, CAT Telecom.
Chief executive Suphachai Chearavanont expressed confidence that True can seek a win-win resolution with the state telecom enterprise before setting up the fund.
"We're hastening to reach a compromise resolution with CAT without creating risk to investors," Mr Suphachai said, declining to give further details.
True is still locked in a dispute with CAT over the ownership of 20% of True's network assets.
The companies have yet to reach an agreement on whether True should return 7,000 telecommunications towers to CAT, as True operates second-generation service under a build-transfer-operate concession.
But Mr Suphachai insists the telecom towers belong to True and are not required under the terms of agreement with CAT. The dispute is now under consideration by an arbitration panel.
Last month, True reported to the Stock Exchange of Thailand (SET) that its board approved a fund-raising plan through an infrastructure fund. It has prepared a filing to seek approval from the Securities and Exchange Commission (SEC).
Under the plan, True would sell telecom towers, fibre-optic cable networks, broadband networks and the rights to gain revenue from equipment rental to the fund. True would also acquire 33% of the fund.
True has 13,000 telecom towers _ 7,000 belong to True Move, the group's mobile flagship, and 6,000 to True Corporation.
The company would lease the assets back from the fund for a maximum term of 15 years, with a transaction size not exceeding 55 billion baht.
Mr Suphachai said True intends to lease only assets that True Group will use.
CAT chief executive Kittisak Sriprasert opposes the fund-raising move by True, saying the telecom tower dispute is still tied up in arbitration. The state enterprise has set up a legal team to handle the case.
Mr Kittisak said he is unsure whether the asset transfer dispute can be settled before the concession between True and CAT ends next month. Under the agreement, True Move would have to transfer network assets to CAT within 90 days of the concession's expiry.
Prakit Boonyatthiti, the SEC's director of corporate finance, said the commission has yet to begin considering True's fund-raising proposal.
Shares of TRUE closed yesterday on the SET at 7.85 baht, down 20 satang, in heavy trade worth 1.97 billion baht.
About the author
- Writer: Komsan Tortermvasana
Position: Senior Business Reporter