news from company today:
Metromedia International Group Enters Local Telephone Market in
Azerbaijan
Wednesday, August 5, 1998 07:31 AM
EAST RUTHERFORD, N.J.--(BUSINESS WIRE)--Aug. 5, 1998--Metromedia International Group, Inc. (MMG:Amex) announced today that its wholly owned subsidiary, Metromedia International Telecommunications, Inc., ("MITI"), has acquired a controlling interest in a new company, Omni-Metromedia Caspian, Ltd., ("OMCL"). The new company has been formed to participate in a joint venture with the Ministry of Communications of Azerbaijan ("MOC") to provide a full range of telecommunications services, including local, domestic and international long distance telephone service, data services and Internet access, for the country of Azerbaijan.
The joint venture, Caspian American Telecommunications, LLC, ("CAT"), is 50% owned by OMCL and 50% by the MOC. CAT has been given the right by the MOC to provide high speed Wireless Local Loop services and digital switching throughout Azerbaijan. CAT has specific interconnection arrangements with Aztelecom and the Baku PSTN in both outgoing and incoming directions, thus permitting all of these companies to benefit from increasing traffic usage. Aztelecom and the Baku PSTN are state owned entities controlled by the MOC and are the dominant operators for both domestic and international services.
Currently, Azerbaijan, with a population of 7.6 million people, has a 9% teledensity, and only 10% of all switching capacity is digitalized.
CAT is planning to deploy both Airspan Communications Corp.'s Multispan and Airspan systems for 32/64 kilobit and 128 kilobit service. By deploying these systems, CAT plans to offer high quality voice, fax, data, image and Internet access services throughout Azerbaijan at costs that are substantially less than wired service. Omni-Metromedia Caspian Ltd. has committed up to $40 million of loans to CAT for the funding of equipment acquisition and operational expenses in accordance with CAT's business plan.
Stuart Subotnick, President and CEO of MMG, commented that "Azerbaijan is receiving significant foreign direct investment and was recently reported to have signed contracts with British companies
totaling in excess of $13 billion related to the oil and gas industry. These investments should boost the Azeri economy considerably, and in the process, fuel rapid growth of the telecom sector. CAT is at the forefront of this development, installing digital communications switching capability and wireless local loop subscriber lines for both domestic and international services."
Other investors in Omni-Metromedia Caspian Ltd. include Omni Communications, Inc., World-Tel Ltd. and AIG Silk Road Fund Ltd., an investment fund sponsored by AIG Capital Partners, Inc.
Metromedia International Group, Inc. is a global communications and media company. Through its wholly owned subsidiary, Metromedia International Telecommunications, Inc., the Company owns and operates communications and media businesses in Eastern Europe, the Republics of the former Soviet Union and other emerging markets. These businesses include wireless and wired cable television stations; FM radio stations; radio paging operations; and a variety of telephone
operations including GSM cellular, international toll calling, fixed wireless local loop and trunk mobile radio. Through its approximately 58% ownership of Metromedia China Corp., MITI operates ventures supporting Public Switched Telephone Networks and GSM systems in China.
This news release contains certain forward-looking statements that involve risks and uncertainties. Factors that could cause or contribute to such risks and uncertainties include, but are not limited to, general economic and business conditions, competition, changes in technology and methods of marketing, and various other factors beyond the Company's control. This also includes such factors
as are described from time to time in the SEC reports filed by Metromedia International Group, Inc., including its most recently filed From 10-Q.
Visit Metromedia International Group at www.metromedia-group.com
CONTACT: G. A. Kraut Company, New York
Jeff Luth, 212-696-5600
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