Jasmine International Plc, the parent of TT&T Plc, has abandoned the ambitious 50-billion-baht (US$1.4 billion) third-generation (3G) investment plan of its provincial fixed-line telephone unit because it's not viable.
CEO Pete Bodharamik, a son of the founder Adisai Bodharamik, said Jasmine no longer had a policy to diversify into 3G mobile services as it saw no reason for TT&T to make such a large investment for unpredictable returns.
"Given its lack of capability against existing mobile-phone operators in network infrastructure, unspecialized mobile business and marketing competition, TT&T is not in a position in the foreseeable future to operate 3G mobile services as it cannot compete with the country's two largest mobile operators, AIS and DTAC," said Mr Pete.
Mr Pete said TT&T was now in a "critical period" in its business rehabilitation plan. It should focus on core fixed line-based services including broadband Internet and content to offset declining fixed-line voice revenue to create a new sustainable income stream, he said.
"Diversification is not the right strategy for TT&T under the current corporate and economic circumstances," he added.
TT&T recently received approval from the Central Bankruptcy Court to enter a business rehabilitation plan. It is on the verge of seeking a planner to prepare the rehabilitation plan and putting it to a vote by its creditors within 45 days after the court's approval.
TT&T now has 21 billion baht (US$594 million) in debt. Of the total, 18 billion baht (US$511 million) consists of long-term obligations of five to 10 years, and the remaining three billion baht (US$85 million) is supplier credits.
Mr Pete said Jasmine had prepared to inject at least 100 million baht (US$2.84 million) to maintain its shareholding stake at 30 percent in TT&T following the rehabilitation plan.
TT&T is likely to be appointed as a planner next month in preparing business plans and debt restructuring. The company would request creditors write off and reschedule its debts to be repaid over a period of 10 years, he said.
Mr Pete also said that Jasmine might reconsider 3G if broadband subscribers reach two million. Triple T Broadband, the broadband internet arm, expected to have almost 400,000 broadband customers by the end of this year.
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