Brazil's Anatel Sees No Bidders For June 5 Wireless Sale
Dow Jones Online News, 05/31/2001 13:37
SAO PAULO -(Dow Jones)- Brazil's Anatel is selling, but nobody seems to be buying.
The telecoms regulator said Thursday it canceled a June 5 auction, after no companies entered proposals to compete for two wireless network operating licenses with combined base prices of about 1.3 billion reals ($1=BRR2.30).
This is the second time the licenses - for the country's center-south region and Sao Paulo state - have gone unsold, after an earlier auction flopped in the first quarter.
Anatel said it is studying how and when to re-offer the licenses.
Brazil's biggest phone company - Tele Norte Leste Participacoes SA (TNE), or Telemar - had been the only expected bidder.
But Telemar, which bought a wireless license in February for its home region in Brazil's northeast, has moved in recent days to cut back its ambitious capital expenditure program for the next couple of years.
Brazil's government is in the process of selling nine new wireless network operating licenses that will add to a crowded field of 19 existing mobile operators. So far, just four of the new licenses have been sold, for about $1.5 billion. Three licenses went to Telecom Italia Mobile Spa (I.TIM).
All told, the nine licenses had combined base prices of about BRR6.8 billion, and were expected to bring in a healthy piece of Brazil's 2001 foreign direct investment. The central bank's foreign direct investment target, which is currently under revision, is $24 billion for 2001.
The new licenses are being sold on Global System for Mobility technology and offer greater data capacity and larger footprints than Brazil's existing licenses, which run on Code Division Multiple Access of Time Division Multiple Access networks.
Companies have complained that Anatel's build out requirements for the new networks are too demanding.
Meanwhile, Anatel said it is planning to re-auction, possibly in August, three other licenses from a failed January auction.
The auction, which excluded firms with fixed-line operations in Brazil, was postponed after no bidders demonstrated interest in the licenses.
-By Terry Wade, Dow Jones Newswires; 5511-3813-1988; terry.wade@dowjones.com
(This story was originally published by Dow Jones Newswires)
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