Information and Communication Technologies
29 Jul 2003
10 Jun 2003
The proposed project intends to support the consolidation of the fragmented cable TV industry and strengthen the competition in the Romanian telecoms market by financing a leading Cable TV operator, Astral Telecom, to expand and modernise its networks. The Bank will provide a US$ 7 million loan to finance a part of this program, together with other development banks. The expansion and modernisation program will enable Astral Telecom to streamline its operations due to the economy of scale, to enhance its broadband Internet offer, expand the voice telephony service and improve the quality of its services.
Although recently liberalised, the telecoms market in Romania does not benefit from the full effect of competition due to the fragmented status of the potential competitors to the incumbent. The key transition impact comes from the demonstration effect of the appearance of alternative fixed line operators offering packages that include TV programmes, Internet and voice telephony. This is likely to generate further consolidations and modernisations and will have a very positive effect on pricing the access services, accelerating the tariff rebalancing process.
Astral Telecom S.A. is a cable TV, Internet and voice telephony service provider operating in more than 52 cities and 110 locations in Romania. Astral Telecom is owned by a group of private investors and investment funds including AIG-New Europe Fund.
US$ 7 million senior debt.
US$ 10 million.
The project was screened C/1 requiring a corporate environmental audit of Astral’s operations which is currently underway initially using the Bank’s Corporate Environmental Due Diligence Questionnaire For Cable Companies. The Operation is unlikely to involve significant environmental impacts. Environmental issues are likely to be associated with construction and installation works, right-of-way and general health and safety issues. The Operation will be required to meet national and EU environmental, health and safety standards. The Bank’s environmental monitoring will be carried out through Annual Environmental Report.
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