Dtac, Thailand’s third-largest mobile operator, reached a settlement with state-owned CAT Telecom concerning a number of legal claims, with the operator agreeing to pay THB9.51 billion ($296 million).
The Telenor-owned operator said the agreement covers most, but not all, of the disputes which arose during a more than 27-year concession period with CAT.
Some are still pending litigation. These include disagreements regarding additional revenue sharing, a CAT accusation dtac did not comply with a non-competition provision of the concession, as well as a claim related to the expired concession agreement (which ended 15 September 2018) which could be raised by CAT in the future.
However, the settlement does not include two key disputes around revenue sharing: one related to excise tax, the other interconnection charges.
The agreement was cleared by dtac’s board and needs shareholder approval, after which it will make an initial payment of THB6.84 billion. The remainder will be paid once the relevant cases are withdrawn from the court in accordance with the agreement.
Dtac noted the payment will have no material impact on its liquidity and financial position.
The companies’ long-running legal issues represented significant legal risk for dtac moving forward, which is looking to turn its business around after losing market share and suffering declines in revenue in 2018. In Q3 it posted a net loss of THB921 million due to a one-time amortisation charge from settling a dispute related to the ownership of towers with CAT Telecom.Subscribe to our daily newsletter Back