PHONETIME INC. has signed a memorandum of understanding with Carib-tel (Caribbean) Ltd. to install and operate telecommunications equipment for Carib-tel in Jamaica.
In exchange, Phonetime will receive a 10-percentage equity stake in Carib-tel and a seat on its board of directors, Phonetime stated in a recent release. The transaction, which has a value of approximately Can$500,000 (J$16 million), remains subject to the execution of a definitive agreement and regulatory approval. The transaction is expected to close by the end of July 2002.
"We are pleased to see Phonetime, a Canadian company, invest in Jamaica and its people," Minister of Industry, Commerce and Technology, Phillip Paulwell, stated in the release. "High quality, low cost telecommunications is one of the key mandates of this Government as we move towards full deregulation of our telecom industry."
GOVERNMENT APPROVALS
Carib-tel is a private Toronto-based company which has received government approvals and licenses to provide telecommunications services in Jamaica. In July, Phonetime plans to install a switch with 10 million minutes of capacity for local service and international resale of telecom services throughout the island.
"Jamaica has all the components to become one of the fastest growing telecom markets in the world and we anticipate our investment will quickly grow in value," said Wayne Silver, president and chief executive officer of Phonetime. "When full deregulation is completed, the wholesale opportunities should further enhance the value of our investment in Carib-tel. Our goal is to make the Phonetime/Carib-tel network one of the world's major gateways for minutes to and from Jamaica."
"For the past two years, we have been looking for the right network partner to help us turn Carib-tel into a reality," said Courtney Betty, chief executive officer for Carib-tel. "We have strong distribution channels already in place in Jamaica and Phonetime brings the necessary experience and technology to our partnership... Together we plan to emulate their model in Jamaica by building our own local infrastructure. We are very confident that we will be able to provide Jamaicans a cost effective, high quality alternative to the incumbent telephone company."
