THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Wednesday, December 20, 1995 TAG: 9512200386
SECTION: BUSINESS PAGE: D2 EDITION: FINAL
SOURCE: BY DAVE MAYFIELD, STAFF WRITER
LENGTH: Medium: 62 lines
International Family Entertainment Inc., continuing its plunge into Asia, said Tuesday that it has agreed to buy the majority interest in a Pakistani cellular phone company.
The Virginia Beach-based IFE, parent of The Family Channel, said its purchase of the stake from a Motorola Inc. unit is contingent on the approval of the Pakistani government. IFE must also still line up financing for the deal.
Terms of the preliminary agreement weren't disclosed.
The investment, through a newly formed IFE subsidiary called Mobilink Partners Inc., would be the first in the telephone business for IFE. But it is only one of several Asian initiatives under way for the company chaired by Pat Robertson.
Last month, IFE announced that it will invest up to $10 million in a Hong Kong-based TV programmer that reaches 28 million Chinese households. Last January, the company signed a deal with another Hong Kong-based company to distribute its programs in more than 15 Asian nations, including China.
The cellular-phone system, called Pakistan Mobile Communications Ltd., serves fewer than 10,000 subscribers in a nation of 130 million people.
But Robertson said in a prepared statement that demand for telecommunications in Pakistan is rapidly growing and ``the economies of wireless transmission as an alternative to wired services are appealing.''
The investment won't be without risk.
Pakistan is one of Asia's most unstable countries. The Islamic nation's human-rights commission said in an October report that the country had suffered a ``breakdown of civilized institutions.'' It said ``unbridled terrorism'' by Pakistan's political parties had created near-chaos in Karachi, the country's largest city and commercial capital where more than 1,500 people have died in political violence this year.
Last month, the Karachi Chamber of Commerce and Industry said in another report that confrontations between Premier Benazir Bhutto's government and the ethnic Mohajir Qaumi movement, which dominates the city, is costing the local economy an average of $38 million a day. It said strikes related to the conflicts had halted commerce in Karachi 28 full days and 20 partial days in the first 10 1/2 months of the year.
Nevertheless, in his statement, Robertson called the Pakistani venture ``an exciting financial opportunity.'' Robertson, who is also chairman of Virginia Beach-based Christian Broadcasting Network, said he had met with high-level government officials, and ``I am confident we will have a cooperative working relationship with the government of Pakistan.''
Laura Cain, a Motorola spokeswoman, declined to say what led to her company's interest in selling its stake in the Pakistani operation. She said Motorola has invested more than $30 million in the operation since it joined with local partners in 1992. Motorola has no plans to dispose of its cellular operations in 15 other Asian nations, she added.
David R. Humphrey, an IFE senior vice president, said one appeal of investing in cellular is that it can be highly profitable even if only a small percentage of potential users subscribe. MEMO: Bloomberg Business News contributed to this report. by CNB