NEW YORK-Consorcio Ecuatoriano de Telecommunicaciones S.A., Ecuador’s largest cellular carrier, announced last week it had scrapped plans to go public.
Instead, the Quito-based company said it will seek to meet its capital requirements “through an alternative financing strategy in the high-yield (debt) and private-equity markets (with) Lehman Brothers (Inc.) acting as financial adviser.”
The carrier had filed earlier with the Securities and Exchange Commission for an initial public offering of nearly 9.2 million American Depository Shares priced between $13.50 and $15.50 each. Its ADS, each of which would have represented four shares of Class B common stock, had been approved for listing on the Nasdaq National Market. The company later scaled down the size of the planned deal to 6.8 million ADS.
Doing business as Conecel, the wireless services company offers analog and digital cellular service under the “Porta” brand name.
Conecel said it had 104,061 cellular subscribers as of Dec. 31, representing a market penetration of less than 1 percent but also about 65 percent of all cellular customers in Ecuador.
The carrier, which launched service in 1994 under a 15-year renewable license, reported revenues of $75 million at the end of 1997, up from about $29.8 million in 1996. Its operating income for the year that ended Dec. 31 was $13.8 million, up from $1.4 million the prior year.
Approximately 95 percent of Conecel’s 1997 revenues were attributable to its cellular operations.
Besides conventional cellular service, Conecel also offers public pay phones using cellular technology. By the end of last year, it had 1,440 such phones in operation, each of which generated average monthly revenues of about $110 and had an average payback period of 18 months. All of its cellular pay phones operate using prepaid calling cards.
