Next Mobile president and CEO Mel Velarde revealed yesterday that the expansion will involve 15 key areas where business activities abound. These include Baguio, Cebu, Davao, Cagayan de Oro, Tarlac, Urdaneta in Pangasinan, Cabanatuan, Iloilo, Bacolod, Bataan, Zamboanga, Cavite, Batangas, Puerto Princesa in Palawan, Roxas in Capiz and Kalibo in Aklan particularly Boracay.
Of the P1.6 billion, around P1 billion will be sourced from a rights offering. Velarde said that they have received two offers (one local and another foreign) to underwrite. "We will decide on the underwrite by the end of October," he disclosed.
The balance of P600 million, meanwhile, will be sourced from loans. Velarde revealed that the foreign underwriter who made an unsolicited proposal has committed to source the loan in case its bid is chosen by NMI.
The company is also in the process of completing its backdoor listing through the acquisition of publicly listed entity Premiere Entertainment Productions Inc. (PEP).
Velarde said that they intend to submit all the documents by October or November this year to the Securities and Exchange Commission (SEC) and the Philippine Stock Exchange in order to secure approval for the merger between NMI and PEP.
The five companies that own NMI earlier merged with PEP through a share-swap scheme. The NMI chief executive revealed that the emerging listed entity will be Next Communications which will own 97 percent of NMI as well as majority of PEP.
"We hope that before the end of 2004 or by January of next year, the merger will be completed," he said. Right now, 50 percent of PEP is publicly owned. With the eventual merger with NMI, about 13 to 15 percent will be owned by the public.
NMI has recently activated its new cellsite in Baguio and plans to expand to Cebu by December, the first expansion outside of Luzon.
Velarde explained that the money that will be raised from the rights offering will be used to upgrade NMI’s switches and establish a presence in 15 key areas.
One cellsite costs around $350,000 with each city requiring three to four sites. In Cebu for instance, NMI will need to install an initial three cellsites and then another two. Davao might need more than five cellsites.
At present, NMI has 30,000 active subscribers. Velarde expects an additional 4,000 new subscribers with the launch of the U365 (unlimited dispatch, mobile Internet, and text for 365 days).
Velarde expects the fourth quarter of this year to be the ‘main event’ of the company. This year, he explained, was focused on investing and expanding and cleaning up data base.