Taiwanese WiMAX Operator in Financial Trouble

It has been reported that Taiwan based WiMAX license holder, First International Telecom (Fitel) has started to bounce cheques it has issued to suppliers. The company recently bounced payments worth around US$2.7 million and may have difficulty maintaining future payments if a planned fundraising effort fails.

Although the company has made part payments for checks bounced recently, Fitel is obligated to pay over NT$100 million (US$3.15 million) in debts before the end of this month, company chairman Charlie Wu was reported as saying by DigiTimes.

The company has net debts of NT$3.5 billion (US$110 million) and is also in arrears in its license fee payments to the telecoms regulator, who could shut down the company.

In addition to the WiMAX license, the company operates a PHS based mobile phone network, but the operating profit is barely covering its debt liabilities.

The regulator recently refused the company permission to spin off its WiMAX business into a separate company to protect it from the group's financial problems.

Motorola is currently deploying its WiMAX network for Fitel in downtown Taipei.

On the web: DigiTimes

Posted to the site on 3rd September 2008