Phone group rings up new credit line

TELECOMASIA Corp, the first private-sector company to operate a telephone service in Thailand, signed a US$1.9 billion credit facility yesterday.

The company plans to use the 10-year facility, extended by banks and equipment suppliers, to partly finance its $2.5 billion telephone line construction project in Bangkok. Equity financing will cover the rest.

TelecomAsia has also applied for a listing in Thailand, where it plans to issue new shares accounting for 10 per cent of the company.

TelecomAsia is 25 per cent owned by the Hong Kong-listed Orient Telecom and Technology Holdings. The Charoen Pokphand Group in Thailand, one of Asia's largest agri-industrial conglomerates, has a 60 per cent stake and is a strategic partner.

The American NYNEX Network Systems Co has also been recruited as a strategic partner, and has taken up the remaining 15 per cent. It provides planning and operational support.

TelecomAsia was in 1991 awarded a build-transfer-operate contract for two million telephone lines in Bangkok. There are already 1.5 million lines run by the government-owned Telephone Organisation of Thailand.

The company has the right to operate the new network for 25 years.

By the time the project is completed in May 1997, the ratio of telephones to population - now 14.3 per 100 people - is expected to have doubled.

Vallobh Vimolvanich said he expected the project to break even in 1996. From then, profits would go to the company and the state-owned Telephone Organisation of Thailand, the latter getting 16 per cent.