Silknet

active

In May 2006 the government of Georgia sold 90.65% shares of its fixed-line operator United Telecommunication Company of Georgia (UTC), previously known as Sakartvelos Elektrokavshiri, to a Kazakh-Georgian consortium named Black Sea Telecom Holding BV for US$90 million. UTC had 350,000 of Georgia's 680,000 subscribers at the end of 2004. The Georgian fixed-line market had struggled through lack of investment and increasing fixed-mobile substitution. At the time of divestiture, 50% of UTC infrastructure and 75% of cables were reported as useless. Black Sea Telecom Holding BV consortium was formed by Kazakh commercial bank TuranAlem and Georgia's Silk Road Group. The consortium won the stake in UTC through a competitive tender by offering the highest price for the government shares. The minimum price set by the government was for the 90.65% was US$50 million. The other bidder was U.S. group Metromedia, which owned an 81% stake in rival fixed-line operator Sakartvelos Telekomi, and offered US$81.25 million. According to the conditions of privatization agreement, borrower had to pay 50% of its offer in one month after the tender, the rest in three months. In addition, the winning consortium was obliged to run and support the company and services to customers for three forthcoming years. In late 2006, Black Sea Telecom Holding indicated that it planned to invest US$50 million in its first three years of operations. In 2010, United Telecommunications Company, Wanex Ltd and Ajara Electrocommunication Ltd were consolidated into one company Silknet. According to a Transparency International report, Silknet's current owners are unclear, although it seems partially owned by the Silk Road Group. As of 2010, Silknet was awarded a radio frequency license which allows the company to offer wireless telephone (CDMA) and high speed internet services. As of 2011 the company offered comprehensive telecommunications packages - telephone, internet and TV services. As of 2012, Silknet, together with Caucasus Online, were the two main players in Georgia's internet market. In Jul 2013, the Georgian government announced the extension of Silknet's radio frequency spectrum licenses for ten years. Silknet is required to pay $7.2 million for the extension. Company website http://silknet.com/ 2007 investment commitment is for 3 years (08, 09, 2010) cannot find 2011 info 2012-2013 capacity figures include both mobile (2013 data from Wireless Intelligence) and fixed subscriptions (assuming fixed subscriptions stay constant at 2008 - 2010 figures). 2012's mobile subscriber data was obtained from an article on Factiva (Title: "In 2012, Number of Subscribers of Mobile Communication Increased by 6,1%").