Unwired hits back at "inaccuracies" in media

Stan Beer
Thursday, 06 October 2005 10:00

IT Industry - Listed Tech

Wireless broadband provider, Unwired Group Limited (ASX:UNW) has hit back at a report in the print media which the company claims contains inaccuracies about the value of its funding deal with Intel.

In a statement to the Australian Stock Exchange, Unwired reiterated that it believes its proposed $37 million convertible note fund raising agreement with Intel is favourable to shareholders in the long term and will result in a strong strategic position and significant revenue growth for the company in the future.

Unwired stated its wish to correct what it claimed were inaccuracies contained in a report in the Australian Financial Review of 5 October, 2005, commenting on the company's funding arrangement with Intel.

According to Unwired, the report undervalued the strategic benefit of the company's partnership with Intel, and the long-term revenue growth potential of the Australian wireless broadband market.

Unwired said in its statement that Intel is a major proponent of WiMAX wireless broadband solutions around the world and is
working closely with Unwired to promote and deliver WiMAX wireless broadband to Australian consumers. Unwired owns the majority of spectrum licences in the WiMAX designated frequencies in metropolitan Australia.

According to Unwired, the Intel investment in Unwired does not hand control to Intel. If Intel holds and converts its convertible notes and no other issues have been made it will own 25.5% of the company which will make it the largest minority shareholder but would not give it a controlling stake, Unwired said.

Unwired said Intel's investment will enable the company to rollout into key population centres outside of Sydney in 2006. In its Explanatory Memorandum Unwired has stated its intention to raise an additional $23-35 million within the next 12 months to further expand within its licence area. Unwired confirmed that closing of the Intel investment is not conditional on the raising of these further funds.

The market obviously liked what Unwired had to say because UNW shares closed up 1.5c to finish on 50c in a heavy day of trading.