America Movil and Citigroup to launch mobile banking services (Latin America)
America Movil, Mexico based wireless service provider, has reportedly entered into a joint venture with Citigroup to provide mobile banking services in Latin America. The $50 million venture has been named ‘Transfer’ and is expected to begin in Mexico by early next year.
As per reports, the joint venture will enable customers to open bank accounts, transfer money, withdraw cash from the ATMs along with shop, receive payments and pay bills via their mobile handsets. The service will initially be offered to clients of Citi’s Mexican subsidiary, Banamex and Telcel.
Manuel Medina-Mora, Chairman & Chief Executive Officer, Latin America & Mexico of Citigroup Inc. has reportedly said that the governments could use ‘Transfer’ as a platform for making benefits available to the poor, as well as for civil service payroll.
Google plans NFC trails with MasterCard and Citigroup (US)
If rumors are to be believed, Google has teamed up with MasterCard and Citigroup to embed NFC services into Android smartphones. Surprisingly, Google is not planning to take a percentage of the transaction fee, in a move which could pitch its business model in direct competition with Apple which is expected to demand its slice of the revenues.
According to sources, instead, Google expects to generate revenues from information services such as customer data and advertising to consumers. The move could raise some privacy concerns though, as Google would then – in theory – be able to know which locally delivered adverts lead to an eventual sale in a retail store.
The Google backed system is expected to be launched later this year, and the company has already signed a deal with VeriFone to supply NFC enabled readers to retail stores wanting to join in the trials.
Google’s mobile-payment service could also face competition from EBay’s PayPal and ISIS, a joint effort of several mobile companies. The ISIS system, backed by AT&T and Verizon Wireless, will rely on Discover Financial Services to handle the payments.
Vimpelcom focuses on $4 billion bridge to bond for M&A deal (Russia)
If sources are to be believed, Russia’s VimpelCom Ltd.’s is homing in on a $4 billion bridge loan to be refinanced in the bond market to back the telecommunications company’s $6.5 billion stock-and-cash acquisition of the bulk of Naguib Sawiris’s telecom assets.
According to sources, several banks are in the process of getting internal credit approval to provide the financing.
As per the sources, they are getting guidance from the company on what they are looking for now.
As per the previous reports, VimpelCom is likely to find favor among bond investors as the frenzied search for yield continues. The higher yields offered in emerging markets have always been there, but the recent rush of money has been exacerbated by the lack of issuance in developed markets.
The sources claimed that Vimpelcom has considered the options open to them and are homing in on a $4 billion loan to be taken out in the bond market.
Among the assets that VimpelCom is acquiring are Italian mobile group Wind Telecomunicazioni and a 52% stake in Cairo-listed Orascom Telecom Holdings.
According to the analyst, Orascom alone has $4.2 billion of net bank debt. Wind has net debt of $11.2 billion–mainly in bonds, and mostly with a change-of-control clause that is likely to be triggered by the takeover.
Citigroup, Deutsche Bank and UBS have acted as financial advisers to Vimpelcom on the deal.
Axiom Telecom plans to launch Dubai IPO
Axiom Telecom, a UAE-based mobile phone retailer, unit of conglomerate Dubai Holding, is planning to launch an initial public offering for listing on NASDAQ Dubai.
Deutsche Bank is the sole authorized arranger on the deal. According to the sources, the Dubai-based distributor could offer a 30% stake on Nasdaq Dubai, the emirate’s international exchange, in the fourth quarter in what would be the country’s first IPO in more than two years.
The mobile phone distributor has been eyeing a public offering since 2005. The deal is expected to be announced next week. Tecom Investments, a part of Dubai Holding Commercial Operations Group (DHCOG), owns 40% of Axiom.
Dubai Holding is owned by the ruler Sheikh Mohammed bin Rashid Al Maktoum, who is looking to reorganize elements of its US$12 billion in debts as the emirate looks to clean up its balance sheet after reaching near-agreement on the extension of maturities at Dubai World.
According to the sources, Deutsche Bank, Citigroup and Shuaa capital, which are controlled by Dubai Holding, are managing the share sale, which was expected to have been announced formally next week.
The governments of Abu Dhabi and Dubai are also thinking about a merger between the DFM and Abu Dhabi Exchange to create a national bourse.
Vimplecom to acquire stakes in Weather from Sawiris (Orascom)
According to Reuter’s, Russia’s Vimpelcom and Egyptian tycoon Naguib Sawiris are close to inking a term sheet for the sale of Sawiris’s Weather Investments. The later owns 51% share of Egyptian-based mobile group Orascom Telecom. Sawiris controls 100 percent of Italian telecom group Wind and just over 50 percent of Orascom Telecom via his holding company Weather Investments. Sawiris is working with Lazard, Deutsche Bank and Citigroup to sell Weather to Vimpelcom, citing financial speculation
Vimplecom declined to make immediate comment on the report on Tuesday and Orascom was not immediately available to comment.
Orascom interested in Telekom Srbija privatization
www.WirelessFederation.com/news: Orascom Telecom Holding has expressed its interest in the privatization of Telekom Srbija. Belgrade confirmed the plan in March to auction a 40% stake in the telco in September 2010.
Government plan to list 15% of the company on the local bourse with a further 5% going to current and past employees has also been revealed.
A tender to select an adviser for the sale had been announced by Serbia’s finance ministry in April. As a criteria it opined that the adviser must be an investment bank (or a consortium comprising an investment bank) which has handled the sale of a telecoms company from Europe, the Middle East or the Commonwealth of Independent States in the last three years worth at least EUR500 million.
In the tender that closed on the May 10, 2010 Citigroup was reportedly the sole bidder. According to the Serbian government, it believes its 80% stake to be worth around EUR2.5 billion, which if correct would mean that it is expecting to raise around EUR1.25 billion when the sale takes place.
Deutsche Telekom plans to veto Serbian bids
www.WirelessFederation.com/news: The proposal for the privatization of Telekom Srbija has been planned to be vetoed by Deutsche Telekom in order to gradually increase its stake in the telco.
According to Milorad Joksimovic, president of the Telekom Trade Union, a proposed sale of 40% of the national carrier would be unsuccessful, because Deutsche Telekom was keen to ensure no other player held a stake larger than its current 20% share.
He has called for the postponement of the proposed sale until the telco can pay off debts of €630 million owed to Citigroup Global Markets. An offer for the 40% stake has already been submitted. The buyer would immediately gain control over the state telco if the sale goes ahead with the Serbian government, Deutsche Telkom, and Greece’s OTE each holding a 20% stake.
Serbia to be advised by Citi consortium on Telekom sale
www.WirelessFederation.com/news: Serbia has got a consortium led by Citigroup as the sole bidder to advise it on the sale of a 40% stake in Telekom Srbija. Two week time has been left with the tender commission to consider the financial offer by the consortium and decide whether to accept it.
Plan to sell of half the 80% stake in Telekom Srbija has been announced by Belgrade in March along with the investment of the money in infrastructure projects.
Government called a tender for a financial advisor as a part of the sales procedure to determine the value of shares and advise the best sale procedure. According to Deutsche Telekom, it is mulling an offer for the stake; it already has an interest via Greek operator OTE which owns the remaining 20% of the Serbia Company.
India 3G auction reminds of UK 3G debacle
www.WirelessFederation.com/news: In India, 3G auctions are going on and it has created a kind of ripple in the country, described as a new era of Indian telecom. But somehow, it reminds analysts of the debacle that took place in the UK a decade ago when mobile operators went mad as they vied to get their hands on a 3G license.
License to provide 3G service was assumed as a license to print money by the operators as they expected that population would go mad for premium-priced 3G services and applications and all the operators would have to do would be to sit back and wait for the money to come in.
However, nothing happened as expected. 3G turned out to be much more technologically and technically difficult, promised services and apps were delayed by months and as a result, millions of users declined to take up the service. The UK operators spent £22.5 billion recklessly for 3G and are still paying the price.
All this happened a decade ago in UK but India does not seem to be taking any lessons. According to a report from Citigroup, Indian 3G licensing process is losing credibility and that the auctions (that began on April 9) are going beyond rational levels. Even the cash windfall, the Indian government has announced it will gain from the auctions is much more than what analysts have forecasted.
