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Smart to take full ownership of Wi-Fi firm Airborne Access

February 28, 2008 11:22pm
By VERONICA S. CUSI, BusinessWorld Online Editor

MOBILE communications provider Smart Communications, Inc. is taking full control of local wireless fidelity firm Airborne Access Corp. after the original founders and stakeholders sold their stake to ePLDT, a subsidiary of Philippine Long Distance Telephone Company (PLDT).

PLDT and Smart Communications Vice-President for Public Affairs Ramon R. Isberto told BusinessWorld on Thursday that "ePLDT is in the final stages of completing the acquisition of the balance of shares of Airborne Access."

The buyout is the third and final phase of ePLDT’s acquisition of Airborne Access. In 2005, ePLDT acquired additional shares in the Wi-Fi firm to hike its stake in the company to 51% from an original 20% bought in 2003.

Mr. Isberto said the deal was expected to be "accomplished shortly" but could not give a specific date and at what cost. "Eventually, Airborne Access will be transferred to Smart" through an acquisition, he said.

Smart Communications is a wholly owned subsidiary of PLDT. Mediaquest Holdings, Inc., which is owned by the Beneficial Trust Fund of PLDT, has a minority stake in BusinessWorld.

Mr. Isberto declared that transferring Airborne Access to Smart Communications was part of "aligning the different business of providing wireless services ... it is part of the process (and) putting the right pieces together."

"Airborne Access will be another channel to serve our customers and provide the means to combine different services to our customers."

Smart Communications, which claims to have more than 30 million subscribers in its GSM network as of December 2007, has another subsidiary that is providing wireless broadband service, Smart Broadband, Inc.

Currently, Airborne Access and Smart Broadband, through its Smart Bro brand, are in a tie-up to offer their customers wireless services.

Sources said the Airborne Access’ founders sold their remaining 41% to ePLDT just recently.

In an updated profile posted on the Linked In business networking website, Airborne Access founder Jay Fajardo said one of his most recent achievements was having "set up and sold Airborne Access Corporation (www.airborneaccess.net), a Wi-Fi hotspot company, to PLDT." His profile said his stay with Airborne Access ended in January 2008.

A source close to Mr. Fajardo said the sellout had been expected from day one of the initial acquisition. "It was long coming and we’re not talking big bucks," the source quoted Mr. Fajardo as saying. The source added that Mr. Fajardo had given himself five years to grow the company, after which he was expecting to start something new again.

Mr. Fajardo declined to be interviewed for this story. His Linked In profile states he is now founder and CEO of Avanti Wireless, Ltd.

XMG Asia Pacific, Inc. principal analyst Jose Locsin told BusinessWorld that the transfer of Airborne Access to Smart "is a logical move. Smart has more knowledge and resources to manage the (wireless) resources."

Mr. Locsin said Smart would be wise to rebrand Airborne Access to make the brand more compatible with Smart’s other services.

Incidentally, Smart Broadband, Inc. was formerly called Meredian Telekom, Inc. The name change occurred after Smart Communications acquired the company completely in 2006.

With PLDT’s wireless business consolidated under Smart Communications, Mr. Locsin said there was the possibility of PLDT packaging its multiple services under one billing system for improve earnings.

He added that Airborne Access would further strengthen its position in the Wi-Fi market under Smart Communication’s wings.

Airborne Access states on its website that the increased stake of ePLDT in 2005 led to further expansion of its Wi-Fi hotspots in the country from the original five locations at the Ninoy Aquino International Airport.

Wi-Fi allows for wireless Internet connections. - BusinessWorld