Warid Telecommunications Pvt. Limited

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In April 2004, Pakistan Telecommunication Authority (PTA), Pakistan’s telecommunications regulator, awarded one of the two new nationwide GSM (Global System for Mobile Communications) licenses to UAE based Warid Telecommunications Pvt. Limited (Warid Telecom). The second GSM license was awarded to Norway’s Telenor. The license allowed Warid Telecom to build and operate a mobile network in Pakistan for 15 years and was renewable. The license was part of a deregulation initiative undertaken by the Government of Pakistan to foster competition in the telecom industry and to increase the very low teledensity in Pakistan. Warid Telecom also acquired a 20 year long distance international (LDI) license. The 15 year GSM license was awarded through an open auction, conducted by PTA in April 2004, for US$ 291 million. Warid Telecom paid 50 percent of the winning bid upfront and the balance was to be paid over the next 10 years. The LDI license was granted by the PTA for a license fee of US $ 0.5 million and a $10 million performance bond. Warid Telecom was owned by the UAE based Abu Dhabi group. Warid Telecom planned to build a network to handle 1.5 million customers with an initial investment of approximately US$ 150 million for its launch. A consortium of 18 Pakistani banks led by the state owned Habib Bank Ltd. and privately owned Askari Commercial Bank extended US$ 200 million loan to finance the roll out of the GSM network. Ericsson was chosen by Warid Telecom to provide the complete turnkey GSM solution. For national and international long distance calls, Warid Telecom contracted Nortel Networks to provide Voice Over Internet Protocol (VOIP) next generation network. In May 2005, Warid Telecom launched its GSM network for commercial service covering 28 cities with a population of around 32 million. At the time of its launch, Warid telecom was competing with five other mobile phone operators in Pakistan – Ufone, Mobilink, Paktel, Instaphone, and Telenor. The LDI service was launched in October 2004. In 2007, Singapore Telecommunications, SingTel, bought a 30% of Warid's shares for $758 million. The mobile phone license is 15 years and the LDI is for 20 years. The performance bond of 10 million was not included as part of inv. in gov. assets.