Well, its about time that we have heard the news about the 3G license auctions in Pakistan. According to a latest report from Reuters, PTA has finally decided to auction the third generation telecom licenses and the auctions will start on March 29th, 2012. Dr. Muhammad Yasin, Chairman PTA announced this news today. He also stated that telecom companies can purchase the license through bidding procedure while each license is priced at USD 210 million.
Initial Amount & License Validity
Mr. Yasin further stated that before the auction, amount bidders will have to deposit some initial amount which will obviously be used as guarantee and it will also indicate the seriousness of a bid. The initial amount has been set to USD 31.5 million and the license will be termed from 8 to 15 years.
The Chairman also stated that, at this moment PTA is expecting to have at least 10 to 15 potential investors in the initial bidding process. PTA is also holding an investors’ conference in major cities like Islamabad and Karachi for the same reason.
Chairman of Pakistan Telecom Authority, Dr. Yasin further added that after the auction takes place, currently existing telecom operators will be able to offer 3G services to their consumers immediately after a license have been awarded to them. On the other hand, if a new telecom operator obtains a license, they will have to wait till March 2013, and then they will be allowed to start providing 3G services in Pakistan.
Foreign Controlled Companies Not Allowed To Invest In 3G Licenses
PTA also announced that the authority has not set any minimum or maximum requirements for foreign equity. It basically means that foreign controlled companies will also be allowed to invest in 3G licenses and domestic borrowing.
Final Price Might Get a Little Higher
PTA Chairman also stated that the base price of the 3G license is a little higher than they previously expected. PTA previously estimated that the base price of the licenses will be set to $195 million. Professional analysts and experts are saying that the bidding will not go beyond the USD 270 million mark but there is a chance those operators who are not willing to introduce 3G yet, will try increase the bid as much as possible, so only lesser bidders will be able to get their hands on 3G licenses. There is also a chance that the final bid might go to $300 million mark as well.