Investor AB cut investment to Hi3G
October 12, 2002
Investor AB said Thursday that it expects to invest only about
SEK4 billion to SEK5 billion in start-up mobile telecom operator
Hi3G Access AB, about half of what the operator had previously indicated.
The Swedish investment group, which holds a 40% stake in Hi3G, said
it expects to inject about SEK600 million into the company in the
fourth quarter, bringing its total investment by year-end to roughly
SEK1.56 billion.
Investor AB has stated that it will halve its investment in Swedish
mobile operator Hi3G, which would be come down to around SEK 5 billion.
The investment group expects to pump in about SEK 600 million into
Hi3G in the fourth quarter and brings its total investment to around
SEK 1.56 billion.
Investor AB holds a 40% stake in Hi3G with the remainder belonging
to Hutchinson Whampoa. In February 2001 it was estimated that both
firms would invest up to $2.3 billion.
The decision to share much of the network with two other operators
in Sweden, Vodafone and Orange AB, allows costs to be reduced. Now
the rollout of the network is underway, the operator has a better
understanding of the cots involved.
Hi3G was awarded the Swedish 3G license in 2001 that obliges the
operator to provide 99.9% coverage of the population by end 3003.
Hi3G said they will gradually launch commercial services in the
first half of next year. The operator intended to rollout 3G services
this year but instead will run trials on its network.
"We think we need some time to make sure the robustness of the
system and the processes are correct," Hi3G spokesman Niclas Lilja
said.
Hi3G is in talks with banks to discuss debt financing said Marcus
Wallenberg, Chief Executive of Investor AB.
The operator will use the brand name '3' just like Hutchinson's
other 3G operators.
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