Altel (Merged with KazakhTelecom #1086)

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Altel, previously known as Becet International, was awarded a 15 year license to provide analog mobile services in 1994. The license gave Altel the rights to operate analogue AMPS mobile services throughout Kazakhstan on exclusive basis for five years, to establish its own transmission when the suitable circuits could not be provided by the national carrier, and to have the first option for any subsequent mobile license that could be issued. Altel was a 50/50 joint venture between the partially private (40%) Kazakhtelecom, the national long-distance and international network operator monopoly, and the British Wireless Technology Corporation. Wireless Technology Corporation Ltd.'s contribution was US$20 million. Wireless Technology Corporation Ltd. became part of the United States' Metromedia International Group, Inc. (MIG), owner of telecommunications assets in Commonwealth of Independent States and Eastern European companies. However, in November of 2002, MIG sold its 50% stake for around US$5 million to an unnamed buyer. The license was valued by Kazakhtelecom and the company agreed to pay an annual license fee determined by a formula related to the frequency usage and a percentage of revenue with a percentage cap. The company contracted Ericcson as equipment supplier under a US$33 million deal in 1994. Altel had invested US$30 million by end 1997. In 2003, Altel launched the first CDMA-standard third generation mobile network in Kazakhstan under the brand name Dalacom. The overall cost of the project was US$50 million, of which the company had already invested about $20 million by end 2003. The remainder was to be spent in 2004. The equipment supplier was Ericsson which won the US$30 million contract in August of 2003. The first phase of the project was financed primarily with a seven-year $16 million loan from ABN Amro Bank (Switzerland) that was granted under guarantees from a Swiss insurer, at LIBOR plus 0.5%. The company had expected the network services to be available in 12 cities by the end of 2003 and to expand coverage to 70 towns and cities in 2004. Altel had planned to migrate its 30,000 analogue subscribers to the CDMA2000 standard, yet there was concern over the potentially insufficient demand for the high-speed wireless data services in Kazakhstan. By April 2006 the company had some 200,000 customers, a 4% market share in Kazakhstan. Kazakhtelecom announced its intention to purchase Altel in 2006. Kazakhtelecom got full control over CDMA operator Altel in early 2006 and in February 2007 launched its own GSM mobile venture Mobile Telecom Service (MTS).